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^V M ^» « — Raleigh
The E. S. C. Quarterly
VOLUME 18, NO. 1-2 WINTER-SPRING, 1960
Employment Security Commission of North Carolina
Cover Legend Page Two Index On Page Eleven
PAGE 2 THEE. S.C. QUARTERLY WINTER-SPRING, 1960
The E. S. C. Quarterly
(Formerly The U.C.C. Quarterly)
Vol. 18, No. 1-2 Winter-Spring, 1960
Issued at Raleigh, N. C. by the
EMPLOYMENT SECURITY COMMISSION OF
NORTH CAROLINA
Commissioners: Mrs. Quentin Gregory, Halifax; Dr. Maurice
Van Hecke, Chapel Hill; R. Dave Hall, Belmont; W. Benton
Pipkin, Reidsville; Bruce E. Davis, Charlotte; Crayon C.
Efird, Albemarle.
State Advisory Council: Public representatives: James A.
Bridger, Bladenboro, Chairman; Sherwood Roberson, Rob-ersonville;
W. B. Horton, Yanceyville; Mrs. R. C. Lewel-lyn,
Dobson, and Dr. J. W. Seabrook, Fayetteville; Em-ployer
representatives: A. L. Tait, Lincolnton and G.
Maurice Hill, Drexel; Employee representatives: Melvin
Ward, Spencer, AFL and H. D. Lisk, Charlotte, CIO.
HENRY E. KENDALL Chairman
R. FULLER MARTIN Director
Unemployment Insurance Division
JOSEPH W. BEACH Director
North Carolina State Employment Service Division
TED DAVIS Editor
Public Information Officer, Member PRSA
MARTHA JACKSON Associate Editor
Sent free upon request to responsible individuals, agencies,
organizations and libraries. Address: E.S.C. Informational
Service, P. O. Box 589, Raleigh, N. C.
INDEX APPEARS ON PAGE 11
ABOUT THE COVER PICTURES
Top, left, shows workers pulling tobacco plants from tobacco bed prior to
transplanting them in the fields. These may be transplanted by hand or
machines.
Top, right,, in this hand are enough tobacco seed to furnish plants for
four acres of tobacco.
Center, left, worker holds up a perfect leaf of tobacco. This green tobacco
is tied on sticks prior to being put in the barn for curing.
Center, right, these trucks are moving the tobacco hogsheads (about 900
pounds of cured tobacco in each hogshead) to cigarette factories after
redrying process.
Lower, left, here is the interior of an auction warehouse and shows the
shallow baskets of tobacco laid out in long rows marked with the owner's
name and the certified weight of the tobacco in each basket.
Lower, right, auctioneer, with upraised hand, chants the prices bid for
tobacco. Buyers for tobacco companies move along with him examining
the tobacco and bidding on each individual basket.
SUMMER-FALL EDITION
TO FEATURE FURNITURE INDUSTRY
North Carolina's rank in the manufacture of furniture
is at or near the top in the entire nation. The position
would probably depend upon the classifications of furniture.
The span of the furniture in this State runs from "com-petitive"
pieces to the finest "name" suites to be had
anywhere in the world. Tarheel manufacturers of furniture
number in the hundreds and a story about each will appear
in the next edition of THE QUARTERLY.
Requests for copies of the "Furniture Edition" are now
being accepted. The issue will probably be in great demand,
so our supply of "extra copies" will be parceled out on a
first-come-first-served basis. Should you be a subscriber,
there is no need for you to request a copy as you will
receive yours at the address to which your copy usually
goes.
CHAIRMAN'S COMMENTS
Henry E. Kendall, Chairman
Employment Security Commission
Tobacco is the nation's oldest industry, with more than
three million people engaged in producing, manufacturing)
and distributing it. Last year some 65 million Americans!
bought 436 billion cigarettes, 6.4 billion cigars, 74 millionl
pounds of smoking tobacco, and 35 million pounds of snuff.j
Featuring the tobacco industry in this edition of thtl
QUARTERLY brings up-to-date the 1951 edition whicr|
spotlighted the weed. North Carolina raises two-thirds of all
the flue-cured tobacco grown in the world. More tobacccj
products are made in North Carolina than in all the othei;
states combined.
With approximately the same number of acres of tobaccc
being grown each year, only the yield per acre affects the
State's position in its percentage compared with other sec
tions of the world.
There are 32,185 people employed in the tobacco industrj
in North Carolina who are covered by unemployment insur
ance and come under the Employment Security Law.
Federal taxes on tobacco and tobacco products in a single
year amount to more than $1.7 billions. Additional taxes col
lected by State and municipal treasuries from tobacco sol<
at retail total more than $700 millions.
Ever since tobacco was first discovered to be a "mone:
crop" it has gone a long way toward underwriting the cos
of the government. The credit of the Continental Congres
was supported by a loan on tobacco leaf. Benjamin Franklh
helped obtain the loan of some 2 million livres from th
French tobacco monopoly which was to be repaid by 5 millioi
pounds of leaf tobacco.
For many years the economy of North Carolina was de
pendent upon the tobacco crop and textiles. A bad crop coul
be felt by every citizen, and when combined with layoffs ii
the textile industry could be devastating.
In recent years the State has begun diversifying its indus
try. Commercial vegetable crops have come to the forefron
in farming, and today account for an amazing number o
dollars for growers. Poultry raising has become popular an
North Carolina is near the top in the production of broilers
A recent survey shows that in the past nine years thi
tobacco industry has put more than $314 millions in capita
outlays into new manufacturing, processing and researc
facilities. This was done to keep pace with consumer require
ments and to provide better products.
The industry is budgeting about $80 millions during 196C
61 for further expansion and improvement.
In the use of tobacco, countries having the highest pe
capita use in pounds are: U. S., 8.6; Canada, 7.2; Netherland
6.0; Belgium, 5.8; Australia, 5.5; Switzerland, 5.3; Denmarl
5.2; Ireland, 5.1; United Kingdom, 4.9; New Zealand, 4
West Germany, 3.9; and Norway, 3.0.
Also in this issue you'll find stories of other industries i
the State, our Business Machines Unit, an East Coast Far
Pattern meeting, and other notes on activities of yo
Employment Security Commission.
VINTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 3
I J. Reynolds, Largest In Industry . . . Still Continues To Grow And Expand
R. J. Reynolds Tobacco Company,
Vinston-Salem, already the largest in
he industry in sales, continues to
xpand.
In the last three years alone, Reynolds'
capital expenditures
have totaled nearly
$75,000,000 to ex-pand
its facilities
for the manufacture
of cigarettes and
the processing and
storing of leaf to-ga
j <MgpHta bacco. The company
^L ^^Bfflj estimates it will
Bk Wlflra spend about $25,-
Bk JftB 000, 000 more in 1960
gray for new plants and
improvements.
Vast Expansion
This gigantic expansion program in-ludes:
• A new cigarette factory, now being
milt at Whitaker Park in Winston-
Jalem at a cost of $30,000,000. Due for
iccupancy in the spring of 1961, it will
ncrease Reynolds'
igarette manufac-uring
capacity by
!5%.
• A new stem-ning
and redrying
)lant, together with
18 storage ware-louses
with capaci-y
for 260,000,000
>ounds of tobacco, at
3rook Cove, Stokes
Uounty. This facility carter
s now in operation.
• A similar stemming and redrying
)lant, with 24 storage warehouses hav-ng
capacity for 130,000,000 pounds of
tobacco, completed at Lexington, Ken-tucky.
• A new aluminum foil rolling and
converting plant, operating as Archer
Aluminum, a division of R. J. Reynolds
Tobacco Company. (An addition to this
plant is now being built, in which Archer
will be able to produce its own aluminum
sheet from ingots.)
• A new tobacco processing plant in
downtown Winston-Salem.
• A major expansion of the company's
research facilities, adding 60,000 square
feet of floor area.
Brand Leadership
In the highly competitive cigarette
field, the Reynolds Tobacco Company has
the triple distinction of producing:
America's leading brand—CAMEL; the
nation's most popular filter brand
—
WINSTON (introduced in 1954) ; and the
eynolds Tobacco Company's 22-story office build-ig
in downtown Winston-Salem is headquarters
i>r the company's world-wide business.
R. J. Reynold's products are shown above: Top,, chewing tobaccos, bag tobaccos, cigarettes, and
pipe tobaccos.
PAGE 4 THE E. S. C. QUARTERLY WINTER-SPRING, 1 96C
country's favorite menthol-flavored brand
—SALEM (introduced in 1956).
Reynolds makes two other types of
tobacco products and also has the dis-tinction
of producing America's leading
brand in each of those categories: smok-ing
tobaccos—PRINCE ALBERT; chew-ing
tobaccos—DAYS WORK.
Some of the company's other principal
brands are: CAVALIER Cigarettes;
GEORGE WASHINGTON, CARTER
HALL, STUD, and OUR ADVERTISER
Smoking Tobaccos; and APPLE,
BROWN'S MULE, and REYNOLDS'
NATURAL LEAF Chewing Tobaccos.
Reynolds' Archer Aluminum Division
rolls, laminates, and otherwise processes
aluminum foil for use by the company
and for sale to others. It also produces
some additional packaging materials
used by the company. Its output of other
items, including foil for use by florists,
continues to grow.
R.
Company Statistics
J. Reynolds Tobacco Company has
more than 14,000 regular, full-time em-ployees.
In addition, it provides seasonal
employment for more than 3,000 other
employees.
The company's full-time employees
have an average length of service of
better than 14 years. Over 40% of them
have been with the company for 15 years
or longer; 19.1% have service records of
30 years or more.
In 1959 Reynolds had net sales of
$1,286,855,943 net earnings of $90,357,-
655. At the end of 1959 the company's
assets totaled $853,351,560.
Samples of florist foils produced by Archer Alum-inum,
a division of R. J. Reynolds Tobacco Com-pany.
Bowman Gray is chairman of the
board. F. G. (Bill) Carter, former sales
manager, is president. Haddon S. Kirk
is chairman of the executive committee.
Executive vice presidents are A. H. Gal-loway,
former treasurer, and S. B. Hanes,
Jr., former superintendent of leaf buying.
Historical Beginnings
The business of R. J. Reynolds Tobac-co
Company was founded in the sprhn
of 1875 by Richard Joshua Reynolds, m
had been in a tobacco manufacturinf
partnership with his father, in Virginia
but decided to venture out on his ownil
Putting his decision into action, hi
traveled by horseback to Winston, Nort]
Carolina, and bought a piece of land oi
Chestnut Street. The factory he built o]
that lot was a red frame structure whicl
Reynold's new $30,000,000 cigarette factory at Whitaker Park, Winston-Salem, begins to take shop
It will be completed in 1961, expanding the company's cigarette manufacturing capacity by 25<J
"Old Joe", who was appearing with Ringling
Brothers Circus in Winston-Salem, posed as the
model for Camel Cigarette trademark.
Expansion: Reynolds' new facilities at Brook Cove, include a stemming and redrying plant and
storage warehouses, each with an area larger than that of a football field.
WINTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 5
:overed less ground than a tennis court.
Winston was then a community of onJy
500 people, and historic, neighboring
Salem—where George Washington had
ilept not one night but two—was still a
dllage.)
Small as the building was, its cost of
!2,400, including a few crude pieces of
squipment, loomed large to the 25-year-
>ld owner. He had saved up $7,500 to
mild the factory and launch his venture,
rat he needed much of that money to
ray the choice leaf he insisted on for his
iroducts. Leaf-tobacco auction markets
iperated on a "pay as you buy" basis,
ust as today.
Like the factory, E. J. Reynolds' work-ng
force was at first small; he had only
wo regular assistants and scarcely a
lozen seasonal helpers. During the early
rears of the business, chewing tobaccos
vere the only products made. At the
tart, a one-horse dray sufficed to cart
he products to the depot for shipment.
3ecause mechanical means of redrying
he leaf had not been invented, manu-acturing
was necessarily limited to
tbout six months a year.
Quality Pays
Soon the high quality of the Reynolds
>roducts was winning repeat orders, and
he growing demand made additions to
he plant necessary. The thriving busi-less
also created jobs for more em-doyees.
To provide for the expansions,
he youthful owner plowed most of his
larnings back into the business.
Special honors for the quality of its
troducts came to the young company in
895: Reynolds received the highest
iward on chewing tobaccos at the big
]otton States & International Exposition
n Atlanta. That was also the year the
ompany began to produce smoking
obacco.
Paced by the popularity of its chewing
md smoking brands, the Reynolds To-
>acco Company by the close of the cen-ury
had built up a sizable industrial
ilant. It consisted of seven buildings,
imploying hundreds of people. Inventive
levelopments had been such that the
actories were able by then to operate
he year around.
In its present form R. J. Reynolds
Pobacco Company was incorporated in
"few Jersey. It was chartered there in
899, with initial capital of $2,100,000
md 13 stockholders. R. J. Reynolds was
he first president and continued at the
telm until his death, in 1918.
Camels Introduced
The company entered the cigarette
ield in 1913, introducing the first
nodern-type blended cigarette: CAMEL.
That happened to be the same year
Vinston and Salem officially became one
ity.) While a machine had been invented
s early as 1872 to speed the making
f cigarettes, 40 years later cigarettes
were still a quite minor part of the
tobacco manufacturing industry com-pared
with smoking and chewing to-baccos.
With the coming of CAMELS,
the tobacco habits of the nation were
changed in just a few years, and the
"cigarette era" really began. (To bring
the picture up to date, 1957 was the first
year in which over 400 billion cigarettes
were sold in the United States. By 1959,
sales had increased to about 455 billion.
CAMEL has led all other brands for
eleven straight years, according to Harry
M. Wootten, well-known consultant to
the industry.)
All the products of the company are
made in just one locality, Winston-Salem.
Such centralization is rather unique in
the tobacco industry. However, Reynolds
finds this of value in maintaining the
Reynolds welcomes thousands of visitors each year in this room, starting point for one of its plant tours.
A Reynolds guide, escorting plant visitors on a personalized tour, explains a step in the cigarette
packing procedure.
PAGE 6 THE E. S. C. QUARTERLY WINTER-SPRING, 196CI
This cigarette making machine is capable of producing over 1,200 perfectly shaped CAMEL cigarettes
a minute. Tobacco is brought by overhead conveyors that automatically fill the machines. The
inspector checks the cigarettes closely for uniform siie and weight.
high standard of quality for which its
products are famous. The company's
factories form the largest cigarette and
tobacco manufacturing plant in any city
in the world.
Research Important
Research has long been an important
factor in the progress of Reynolds.
Special experiments, begun in 1904, led
to the company's perfecting in 1907 its
process for a new product, PRINCE
ALBERT Smoking Tobacco. Even more
extensive research was next undertaken
in the cigarette field. As a result of this
work, the first modern-type blended cig-arette,
CAMEL, was created. Similar
painstaking efforts were later devoted
to achieving the distinctive character-istics
of WINSTON, SALEM, and CAV-ALIER
Cigarettes. The formula for
CARTER HALL Smoking Tobacco was
also achieved through exacting experi-mentations.
These are but a few of the
many contributions that research has
made to further the progress of the
Reynolds Tobacco Company through the
years.
From a one-room origin, the research
structure in the company has been ex-panded
time and again. Reynolds' pres-ent
research center consists of two large
modern buildings (one completed in
1953, the other in 1957). These buildings
are connected, and the combined unit is
functionally designed for many diverse
activities, including use of the latest
radioisotope techniques. The facilities
for tobacco research are the most exten-sive
in the industry.
The Reynolds research staff includes
many scientific specialists and techni-cians
in a variety of allied fields. It is
in the tradition of Reynolds that the
staff is continually exploring possibilities
for improving the company's products,
devising better and more efficient
processing methods, and developing new
products. Scientists of the company havf
always worked closely with federal ancj
state agricultural agencies, and througl
them with tobacco growers, on tech-jl
niques for bettering the quality of thf I
leaf.
85th Anniversary Year
A short article can give only a capsule-size
account of a business which is nov|
nearing its 85th anniversary. The hand-ful
of employees with whom Mri
Reynolds began his undertaking in 1879
has grown into the force of over 14,00(!
regular employees, already mentioned
Production for the whole original yea:|
would amount to only a fraction of j
present single day's output. Where onc<
they were known in only a few localities
Reynolds' products today are enjoyed al
over America and around the world. Th|
"little red factory" which housed thi
business in the beginning has been multi
plied into over 200 large factory unit
and leaf storage warehouses. In contras
to the $7,500 the founder had to launcl
the entire business venture, the averagj
investment behind each regular em
ployee's job amounts now to ove
$56,000.
Regular employees have the benefit o
the company's group life, accident am
sickness insurance plan; retiremen
plan; comprehensive medical plan o
hospital and surgical service plan; jur;
service plan; vacation plan; paid holi
days; suggestion plan; educational plan
family group life insurance plan; an
profit sharing plan. Among the service
the company maintains for its employee
in Winston-Salem are an extensive medi
After cigarettes are packaged, they pass before
packages are then put into cartons automatically.
an inspector who checks for packaging flaws. Tl
WINTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 7
Expansion: The plant of Archer Aluminum, Reynolds' foil division. Steel framework and part of roof
of new addition can be seen.
cal department, cafeterias, parking lots,
and the confidential assistance of a pas-tor-
counselor. (A small private chapel
adjoins the office of the pastor-counselor
and he uses it in his work with individual
employees who may come to him with
personal problems. It is also available
to persons seeking a haven for private
meditation during the working day.)
On Average Workday
On the products made on the average
workday, the company pays the U. S.
Treasury over $2 million in excise taxes.
Reynolds' shipments in and out of Win-ston-
Salem on the average workday re-quire
upward of a mile of railway
freight cars and highway motor carriers
combined. Considerably more than one
million business concerns enter into
Reynolds' daily operations—among them,
suppliers of the great variety of manu-factured
items used in the plants and
offices; numerous transport lines; thou-sands
of tobacco-product wholesalers,
and a multitude of retail outlets.
More than 81,000 stockholders share
in owning R. J. Reynolds Tobacco Com-pany.
They include people in each of the
50 states and in almost every walk of
life; educational, charitable, and medical
institutions; churches; insurance com-panies;
and pension and trust funds.
Plant Tours
The company is happy to provide per-sonalized
tours in its plant for the public.
This program was begun in 1918 and
has been expanded through the years.
These tours are now provided during all
the working days and nights in the plant.
Thousands of people a month—visitors
from the various states and many foreign
countries—come for the Reynolds tours
to see America's most famous cigarettes
being made.
* * *
The scope of R. J. Reynolds Tobacco
Company today would probably surprise
even that farseeing young man whose
initiative, so many years ago, gave it its
start. The progress the company has
made under the American system of free
and competitive enterprise reflects the
spirit, skill, and teamwork of a great
many people working together over a
long span of years.
COMPLETE
INDEX
ON
PAGE 11
Reynolds' Tobacco Research Center
Salem contains over 100,000 square
area. It provides the finest facilities
in the tobacco industry.
in Winston-feet
of floor
for research
-
••
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*
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....... :- ,::;.j •-..-
-::>S :::0 ;>? :
:
:
:^ . : y^y AS ' yy'^y :
: A yj ^ o ^yfy y ' ': '•-.., .
'
:,...-..y'.r ^ -
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•-:,.
SSI?!?.
R. J. Reynolds Tobacco Company's facilities in downtown Winston-Salem. In the right foreground is
seen the 22-story Reynolds Building, the company's headquarters.
PAGE 8 THE E. S. C. QUARTERLY WINTER-SPRING, 1960
NORTH CAROLINA IS THE HOME OF LIGGETT & MEYERS TOBACCO COMPANY
Liggett & Myers Tobacco Company
traces its beginnings to the early 1800's.
but the Company name of Liggett &
Myers originated in 1873 when John
Edmund Liggett and George S. Myers
formed a partnership. In 1879, the part-nership
was dissolved, and the firm was
incorporated as Liggett & Myers Tobac-co
Company.
The Company prospered and by 1885
was considered the largest plug tobacco
manufacturer in the world, with STAR
as its leading brand of plug tobacco. By
1899, Liggett & Myers Tobacco Company
had become a part of the American To-bacco
Company.
In 1911, the dissolution of the Ameri-can
Tobacco Company, under the pro-visions
of the Sherman Anti-Trust Act,
once more established Liggett & Myers
Tobacco Company as an independent
manufacturer. On December 1, 1911 it
was incorporated under the laws of the
State of New Jersey.
Liggett & Myers acquired the Durham
factory which had been built by W. Duke
Sons and Company in 1884 and had be-come
one of the first units of American
Tobacco. The Company inherited Fatima,
the leading brand of blended cigarettes,
Piedmont and American Beauty, also
among the most popular cigarette brands
at the time, and Home Run, King Bee
and other brands.
In 1912, Liggett & Myers became the
first of the successor companies to ex-periment
with the blended cigarette, as
we know it today, when it introduced
Chesterfield. Chesterfield is a blend of
flue-cured, burley, Turkish and Maryland
tobaccos. World War I enhanced the de-mand
for the blended cigarette, and by
1920, Chesterfield had become the lead-ing
Liggett & Myers cigarette brand. In
1952, Chesterfield became the first cigar-ette
to be marketed in two sizes, both
regular and king-size.
The first President of the reorganized
Liggett & Myers was Caleb C. Dula, a
native of Lenoir, North Carolina, who
had been James Buchanan Duke's able
associate at American Tobacco. Mr. Dula
became Chairman of the Board in 1928
and served in that capacity until his
death in 1930.
Clinton White Toms, a native of Hert-ford,
North Carolina, became the second
President of Liggett & Myers when he
succeeded Mr. Dula in 1928. Mr. Toms
had been Superintendent of Schools in
Durham before he entered the tobacco
business in 1897. William Washington
Flowers, who succeeded Mr. Toms as
Superintendent of Schools in Durham,
left that post to join Liggett & Myers
in 1911. He later became Vice President
and finally served as Chairman of the
Board from 1936 to 1941. A third Super-intendent
of Durham Schools, William
Donald Carmichael, also joined Liggett
& Myers and later became advertising
Vice President before he retired in 1942.
Mr. Toms served as President until his
Front- and rear construction views of the extensive addition being made to L&M Research Laboratories
in Durham, North Carolina. Addition will double size of modern laboratories originally built some
ten years ago.
More than three quarters of a million people have taken one of the most popular of all industric
tours through the modern cigarette factories of Liggett & Myers Tobacco Co. The Durham "home
of Chesterfields, L&M and Oasis pictured here is conveniently located on Main Street in downtow
Durham. Visitors are welcome to take fascinating, hostess-conducted tours between 8 and 11:15 <"
and 1 and 3:30 pm Monday through Friday.
WINTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 9
death in 1936, when he was succeeded
by James W. Andrews, a native of Vir-ginia.
When Mr. Andrews retired in 1951,
he was succeeded by Benjamin F. Few,
a native of South Carolina, a graduate
of Trinity College (now Duke Univer-sity)
and a nephew of Dr. William P.
Few who for many years was President
of Duke. Mr. Few retired November 30,
1959 and was succeeded by William A.
Blount, a native of Washington, North
Carolina.
Before he was elected President, Mr.
Blount was Executive Vice President.
He was elected a /Director in 1941 and
Vice President in
1943. He graduated
from the University
of North Carolina,
and after complet-ing
post-graduate
work, he joined Lig-get
and Myers in
Durham in 1923.
He became Factory
Superintendent i n
to New York Head-quarters
in 1930, where he spent several
years in the Advertising Department. In
1934, he became Assistant Supervisor,
and in 1937 Supervisor, of the Manu-facturing
the Leaf Buying Departments.
In addition to President Blount, there
are four key executive personnel located
at New York Headquarters who have
North Carolina
background. Z a c h
Toms, Executive
Vice President,
whose father was
President of the
Company, was born
in Durham, North
Carolina, and start-ed
with the Com-pany
in Richmond,
Virginia. William L.
Perry, Vice President and Chairman of
BLOUNT
1925 and moved
the Executive Committee, attended Duke
University and began his career with the
Company in Dur-ham.
William B.
Lewis, Jr., Sales
Vice President, was
born in Milton, North
Carolina, and served
with the Company
in Durham. Loy D.
Thompson, Manu-facturing
and Leaf
Vice President, was
reared in North
perry Carolina, received
his B.A. Degree from the University of
North Carolina and began his career
with the Company in Durham.
Today, Liggett & Myers has capital
assets of more than $400,000,000 and is
widely owned by some 47,000 stockhold-ers.
The Company
has two large mod-ern
cigarette fac-tories
in Durham,
North Carolina, and
Virginia. Also lo-cated
in Durham are
the Company's Re-search
Laboratories,
Leaf Buying Depart-ment,
leaf storages,
stemmeries, blend-ing
plant and a
separate smoking tobacco factory. A
large pipe and chewing tobacco factory
THOMPSON
'ictured
•iggett &
above
Myers-are
the familiar
made cigarettes.
packages of
Typical of the Company's modern tobacco pro-cessing
plants is this one at Rocky Mount.
is located at St. Louis and the chewing
tobacco plant of the Pinkerton Tobacco
Company, an unconsolidated subsidiary,
is located at Toledo,
Ohio. Another sub-sidiary,
the Gary
Tobacco Company,
is a Turkish leaf
buying organization,
which was formed in
1915. With head-quarters
now located
at Durham, N. C,
it has Turkish leaf
processing plants lo-lewis
cated at Izmir and
Samsun in Turkey and at Cavalla and
L&M has been a pioneer and leader in the field
of tobacco research for more than 40 years.
Xanthi in Greece. Liggett & Myers also
has leaf processing plants located at
Rocky Mount, North Carolina, Danville,
Virginia, and Lexington and Paris, Ken-tucky.
Company sales offices are located
throughout the United States.
Today, Liggett & Myers has approxi-mately
9,000 employees, many of them
in North Carolina, whose average length
of service is well over ten years. Work-ing
conditions are excellent. The fac-tories
and offices are very modern, air-conditioned,
superbly lighted, and
equipped with every known device to in-sure
safety and guard health. Available
to employees are complete benefit plans,
including an Employees Group Hospital
and Surgical Benefit Plan, an Employees
Group Life Insurance Plan and an Em-ployees
Retirement Plan.
To date, over three quarters of a mil-lion
people have visited the modern Lig-gett
& Myers cigarette factories located
in Durham and Richmond—at a present
annual rate of about 60,000. As a major
A single, modern cigarette making machine,
shown here in the Liggett & Myers Durham
factory, makes as many as 1,250 cigarettes every
minute.
PAGE 10 THE E. S. C. QUARTERLY WINTER-SPRING, 1960
HUNDLEY
tourist attraction in Durham, these
guided factory tours have brought thou-sands
of visitors to the City from every
state in the nation and from many for-eign
countries as well. The Liggett &
Myers factory tour is not only the most
popular in the tobacco industry; it is also
one of the most popular industrial tours
in the country. Visiting hours in Durham
are from 8:00 to 11:15 AM and from
1:00 to 3:30 PM, Monday through Friday.
The stemmery, leaf storage, blending
and manufacturing operations in Dur-ham
are under the direction of J. Cam-den
Hundley, who
was elected a Direc-tor
of the Company
and named Durham
Branch Manager in
1946. Born in Ox-ford,
North Caro-lina,
Mr. Hundley
attended the Carne-gi
Institute of Tech-nology
in Pittsburgh
and was first em-ployed
by Liggett &
Myers in Durham in 1920. He became
Superintendent of Manufacturing in 1930
and Manager of the cigarette factory
in 1946, succeeding Charles H. Livengood.
Leaf tobacco has always been, and is
today, the very essence of the tobacco
business. Liggett & Myers buyers, thor-oughly
schooled in the tradition that it
takes fine quality leaf to make a good
product, attend more than one hundred
tobacco auction markets each year in
Florida, Georgia, South Carolina, North
Carolina, Virginia, Maryland, Kentucky,
Tennessee, Ohio and Wisconsin. Heading
up the Company's Leaf Buying Depart-ment
in Durham is Milton E. Harrington,
who was elected a
Director of the Com-pany
in 1955. Born
in Winterville, North
Carolina, Mr. Har-rington
graduated
from Duke Univer-sity
in 1931. He was
first employed by
Liggett & Myers in
1934 and later serv-ed
as Factory Man-ager,
Leaf Buyer
and Supervisor, becoming Manager of
the Leaf Department in 1955, succeeding
James E. Farley who retired.
Research began at Liggett & Myers
Tobacco Company 47 years ago with the
employment of the Company's first
chemist in 1913. Today, looking forward
to its needs in the next ten to fifteen
years, the Company is doubling the size
of its ultra-modern Research Labora-tories
in Durham, North Carolina. These
Laboratories were originally constructed
in the late 1940's.
The large staff of scientists in the
Liggett & Myers Research Department
HARRINGTON
DARKIS
tobacco research
today is under the direction of Dr. F. R.
Darkis, who was
elected a Director of
the Company in 1956.
Originally from
Frederick, Mary-land,
Dr. Darkis re-ceived
his B.S., M.S.
and Ph.D. degrees
at the University of
Maryland, and first
joined Liggett &
Myers in 1928. In
1933, he went to
Duke University as
associate in the Chemistry Department,
and he returned to Liggett & Myers in
1947 as Director of Research.
Beginning in 1922, Dr. Paul Gross di-rected
research operations for Liggett &
Myers in the Chemistry Department at
Trinity College (now Duke University).
From 1932 until 1947, Liggett & Myers
research was conducted in laboratories
in St. Louis. Then in 1947, the research
operation was returned to Durham under
the direction of Dr. Darkis who had been
associated with Dr. Gross at Duke Uni-versity
between 1928 and 1932.
The Company's research program con-tinually
develops new and improved
products, as well as improvements in the
efficiency and economy of the factory
operation. Basic studies of tobacco and
tobacco products are pursued vigorously,
and the Research Department works
closely with the leaf buying organization
in the testing of new crops of tobacco
and purchasing the quality leaf so essen-tial
to the production of quality products.
In brief, the research program at Lig-gett
& Myers over the years has con-tributed
to the development of new types
of tobacco; new storage and ageing
methods; more scientific leaf buying
methods; improvements in the planting,
growing, harvesting, curing, processing
and blending of tobacco; improved pack-aging
of tobacco products; the growth
of Turkish leaf in this country; the
development of improved cigarette fil-ters
and many others.
Liggett & Myers took an active part
during the 1930's in helping establish
the Ecusta Paper Corporation at Pisgah
Forest in western North Carolina. Be-fore
World War II, most of the cigarette
paper used in this country was imported.
During the War, imports became no
longer available, and ever since then
most of the paper has been made in this
country. Today, the finest cigarette]
paper is made in North Carolina, and
the new industry gives employment to
many people in the western part of the]
State.
For years, the Company has worked
closely with the U. S. Department of
Agriculture and state agricultural de-partments
in a continuing program of
tobacco improvement. The Company's re-search
program has also included grants
to universities, as well as other scientific
organizations, for tobacco research.
When Liggett & Myers was reorgan-ized
in 1911, there were less than 10
billion cigarettes sold in this country,
whereas in 1959, domestic consumption
totaled some 455 million. Today, Liggett
& Myers owns almost 100 brand names,
manufactures 64 different kinds of cigar-ettes
and smoking and chewing tobaccos
and has a sales volume well in excess of
half a billion dollars. Each and every
brand is registered in the U. S. Patent
Packaging machines on floor after floor of Liggett & Myers' modern factories in Durham turn oil
billions of Chesterfields, L&M and Oasis Filter cigarettes every month to meet the world-wide demon
j
VINTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 11
Iffice, and in the aggregate, this repre-ents
a valuable asset.
Liggett & Myers cigarette brands to-ay
include Chesterfield, L&M, Oasis,
Hike, Fatima, Piedmont, Picayune,
[ome Run and Coupon. Smoking tobacco
rands include Velvet, Granger, Country
rentleman, Duke's Mixture, Plow Boy,
ummer-Time, Sweet Tip Top, King Bee
nd Virginia Extra. Chewing tobaccos
lclude Union Standard, Tinsley's, Spark
'lug, Star, Horse Shoe, Picnic Twist,
v\N.T. Natural Leaf and others. Scrap
hewing tobacco brands made and sold
y the Pinkerton Tobacco Company in
'oledo are Red Man, Pay Car and Red
[orse.
Liggett & Myers brands are available
1 approximately 1,500,000 retail outlets
1 the United States alone. They are sold
y Liggett & Myers to about 6,000 cus-
>niers including wholesalers and large
etail outlets such as drug and grocery
dains. And, there are more than 1,000
iggett & Myers sales personnel in the
eld servicing these complex and all-nportant
channels of distribution.
Liggett & Myers is a worldwide busi-ess.
The Company's brands are sold in
lost markets around the world, over 105
)reign countries. These export sales
lake an important contribution to the
ver-all business of the Company.
Because it is in one of the most com-etitive
of all industries, Liggett &
[yers is today one of the largest users
f national advertising in this country.
Fetwork television, including special
Miles of modern leaf storages located on Highway 70 by-pass, Durham, are necessary to properly
age over many months millions of dollars worth of the best tobaccos used to make Liggett & Meyers
brands of cigarettes.
sports events, is the largest single me-dium
used in the Company's advertising
program, but wide use is also made of
radio, magazines, newspapers, outdoor
signs, display advertising and others.
It represents an annual expenditure of
millions of dollars paid for billions of
advertising impressions. This investment
in demand—demand for the Liggett &
Myers quality products—is an important
ingredient in the cigarette business
today.
> R-AMA PLANNED FOR
NOVEMBER 10 AT RALEIGH YMCA
A concentrated, one-day Public Rela-ons
Seminar is planned by the Caro-nas
Chapter of the Public Relations
ociety of America and the Raleigh
ublic Relations Society. The meeting
ill be held Thursday, November 10,
960 in the new Raleigh YMCA on
[illsboro Street.
Co-sponsoring the meeting with the
vo Societies are: WRAL-TV, Raleigh;
/TVD, Durham; WDNC Radio, Dur-km;
WPTF Radio, Raleigh; The Dur-am
Herald, Durham; The Durham
un, Durham; The Raleigh Times, Ra-igh;
The Raleigh News and Observer,
aleigh; the Associated Press and the
nited Press International.
Registration will begin at 8 a.m. and
orkshops will begin promptly at 9:15.
wo major speakers will be featured at
ie luncheon and banquet. Cost of the
itire day, including luncheon and ban-iet
is to be $6 per person.
Workshops will be
:
How To Work With Television;
How To Work With Radio;
How To Work With Newspapers; and
How To Set Up and Operate Any
ze Public Relations Department.
The staffs of the various news media
will constitute the panels of the news
workshops. They will feature men who
know "why your last article or picture
did not hit the public eye and ear." Hor-rible
examples of un-newsworthy pic-tures,
articles and scripts will be shown
the registrants with explanations of
how publication could have been assured.
Four of the nation's top PR executives
are being secured for the PR Panel.
They represent the largest, the medium-sized,
and the most successful small PR
agencies and will have approximately
80 years of PR knowhow and experience
backing them up in their remarks.
Registrants will be divided into four
groups as they register and will attend
all workshops which will last an hour
each. Workshops will begin at 9:15 a.m.;
10:45 a.m.; 2:30 p.m.; and 4:00 p.m.
The luncheon will start at 12:30 and
the banquet at 6:30.
The one-day affair was planned when
it was noted that most PR conferences
start about noon one day and end at
noon the next. By crowding the entire
event into one day, the group will be
made to really think, and will not have
INDEX
American As of 1960 15
Assistant VER Wadsworth Receives Award !!.51
Austin Carolina One Hour of All Markets 30
Bright Leaf Association 27
Burley Growing Is Profitable 32
Business Machines Covers Million Items .34
Carolina Clipping Service Stays Busy 44
Chairman's Comments 2
Charlotte Opens New Office ...56
Cigarette Paper Plant Began 1939 .28
East Coast Farm Placement Meet Is Success 52
Eastern Weed Firms Organize 47
Fayetteville Opens New Office Officially ............. .51
Ficklen One of Oldest '
'
27
Former Employees, Where Now ?
'.'.'.'.'.'.'..' 40
Goodwin, BES Director Arrives .52
Hill Consultants Offer Manv Services ....47
Improving Marketing Practices .26
Lea Tobacco Pioneers 31
Lewis of Washington Visits State 51
Liggett & Myers, N. C. Is Home ' g
Lorillard Celebrates Bicentennial '
' 12
Miller, Domestic and Import Firm 31
Moen Retires
[
50
Monk Tobacco Calls Farmville "Home" ............. .38
Ports of N. C. Important to Industry '41
PR-AMA Planned ..'. jj
Redryers and Packers Listings '40
Registrants At 1960 Pattern Farm Meet ......'.." 53
Research Program of Tobacco Industry 21
Reynolds, Largest in Industry 3
Sanford Tobacco One of Most Modern 37
Southeastern In Heart of Belt .....23
Taylor Brothers' Picturesque Brands ...... . . . . . . . . \ 29
Tobacco Growers Information Committee .'. 48
Tobacco Priming 54
Tobacco's Land of Plenty ..20
Tobacco Tying [\ 55
VER Godwin Celebrates 49
Webb & Company Established 1895 .25
Wilson Tobacco Co. Began in 1917 A0
time to lose interest in the events.
Registrations will be accepted on a
first-come-first-serve basis. They may be
mailed to: Registrar, P R-AMA, Box
—See PR-AMA, page 19—
PAGE 12 THE E. S. C. QUARTERLY WINTER-SPRING, 196C
P. LORILLARD COMPANY-BICENTENNIAL
The candles on its 200th birthday cake
will be lighted by the P. Lorillard Co.
within the next few days to signal the
first corporate bicentennial celebration
in the tobacco industry. Twelve months
hence when it snuffs them out by closing
its books on 1960, it expects to have
made an auspicious start into its third
century in business.
Lorillard officials view their company
as an intertwining of tradition and
progress; the former always being made
and the latter forever representing the
challenge. In a year-end note to stock-holders,
Lewis Gruber, chairman of the
board and chief executive officer, said:
"As we look toward our 200th anni-versary,
we are proud indeed to carry
America's earliest tobacco name, but we
are even more eager to carry on with
America's newest tobacco ideas as em-bodied
by our major cigarette brands.
Throughout 1960 and the years ahead,
you may be sure that Lorillard will
strive to be first with the finest tobacco
products, through Lorillard's research."
Recent History
The recent history of this company
which pre-dates the American Revolu-tion
has been so exciting that it is not
only familiar to everyone in the tobacco
industry, but is also well known to the
nation's entire business community and
to the investing public at large.
Though confident in 1954 that it was
well fortified to withstand the anti-tobacco
crusade by virtue of its Kent
Micronite filter cigarette—the first of
the high-filtration brands—the company
lost considerable ground to manufactur-ers
of popular-price filters. Lorillard
sales rose 12.8% in 1953 when the indus-try
was off 2% from the previous year, but
the following year its volume dropped a
sharp 14.9% when the industry declined
only 4.6%.
It was not until August 1956 that the
company's fortunes began to take a turn
for the better. Lewis Gruber was elected
president by the board of directors and
he began to reorganize and strengthen
his management team. Harold F. Temple
and Manuel Yellen, who had come up
through the ranks in the company, were
made vice presidents. Mr. Temple was
made director of sales, and, later, electee
President. Mr. Yellen was charged witr
directing advertising and marketing, anc
subsequently, was named Sales Vicdl
President.
Dr. Harris B. Parmele, the company's!
vice president and director of research I
was given more authority and instruc-
1
tions to step up and revitalize the com||
pany's research department. George 0;
Davies, treasurer, was promoted to vic<
president and chief financial officer
George A. Hoffman, now vice president
Dr. H. B. Parmele
Research
George O. Davies
Finance
George A. Hoffman
Manufacturing
Shape of Lorillard Progress is embodied in its prize-winning single-level plant at Greensboro, N. C, which covers 13 acres of an 80-acre plot. When
was opened in 1956 it was named one of the 10 "Top Plants of 1956" by Factory Magazine. The plant is a massive and perfectly timed symbol
great changes that have taken place in cigarette manufacture—the rise of the filter cigarette, the new brands, the variation in packaging, etc. The fl
of tobacco is virtually automatic in the processing stages,, the actual cigarette manufacture, packing and shipping. An automatic climate control systi
regulates temperature and humidity according to the needs of the various plant departments. Plant and equipment have been designed "as a unit" acco
ing to specifications of P. Lorillard Company, with special provision for expansion and flexibility so that new developments caused by the shifts
smokers' tastes can be swiftly integrated into the plant's normal operations. Plant has most advanced equipment for scientific research in eight laboratori
WINTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 13
foment before things begin to happen to tobacco
i "live storage" room of P. Lorillard's Greensboro,
I. C, plant. This room is a temporary halt where
he hogsheads will be held until the tobacco is
eeded in the processing. Previous resting places
or the hogsheads had been in terms of storaqe
s storage, but the tobacco's stay here can be
erminated at a moment's notice. The giant hogs-eads
contain aged and cured tobacco classified
xcording to type and grade. They will be opened
it both ends preparatory to going through the
iext stage, the moistening.
'ransformation of tobacco starts in tobacco
loistening unit, which resembles three elevators
nd simultaneously holds four opened hogsheads
f tobacco in each of its three compartments,
obacco coming from the "live storage" room of
. Lorillard Company's Greensboro, N. C, plant
ere enters the first stage of the processing which
hanges it from a dried plant into a fluent
leasure-giver. This process ensures that aged and
ured tobacco has perfect moisture content for
igarette making. A vacuum is created in each of
he compartments, causing the injected moisture
i penetrate throughout the tobacco. Each eleva-n-
like compartment finishes its operation in 16
linutes and the hogsheads are then automatically
onveyed to the next stage.
lixing to taste occurs in this conveyor after the
tree types of tobacco—Virginia, Burley and
urkish—are broken out of the hogsheads and
'ought together on this giant conveyor in the
Lorillard Company's Greensboro, N. C, plant,
obacco
_ keeps moving on conveyor while it is
sing mixed, thus losing no time on its way to
te cigarette-making room.
Blended mainstream of tobacco takes form in
P. Lorillard's ultra-modern plant in Greensboro,
N. C. The tributaries are two separate conveyors
(coming from upper left and lower right on photo-graph)
of identical blended tobacco, which feed
into the large centrally located conveyor con-nected
with cigarette-making room. Tobacco
comes from independent dryer and cooler systems
designed to give it perfect moisture and tempera-ture
to ensure fresh tobacco taste and aroma.
This perfection in bulk form is now ready to be
formed into the neatly contained pleasure of a
cigarette.
was made director of manufacturing.
And Herbert A. Kent, former Lorillard
president and board chairman, was called
out of retirement to serve as a director
and consultant.
Later, when Lorillard's international
operations assumed new importance,
Morgan J. Cramer, head of the com-pany's
export operations, was elected a
director.
Reduced Price
One month after his election to the
presidency, Mr. Gruber reduced the price
of Kents to the popular level and within
ten months sales of the brand tripled.
When in the summer of 1957 a leading
national magazine reported this brand
to give smokers the lowest amounts of
tars and nicotine, consumers virtually
stampeded retail counters to buy Kent.
Even today, some are inclined to at-tribute
Lorillard's success to luck. The
tobacco company's officers do not deny
Distinctive packages of Kents stream out of the
cigarette-packing machines in vast making and
packing room of P. Lorillard's plant in Greensboro,
N. C. The cigarettes have been transferred to the
packing machines by "suitcase" containers and
now, after the packing stage, are en route to be
put into cartons. Heart of plant is this room,
457 feet long and 310 feet wide—large enough
to hold three side-by-side football fields. With
its Micronite filter, Kent caused a revolution in
the cigarette industry, leading an amazingly fast
development that saw filter tip production rise
from insignificance to the capture of half of the
cigarette market in a half-dozen years.
Cartons of Old Golds are sealed as they move
down conveyor en route to the shipping room in
P. Lorillard Company's Greensboro, N. C, plant.
The Old Gold "family" includes the Old Gold
Straight, regular and long size, and the Spin
Filter. The oldest brand among Lorillard's blended
cigarettes. Old Gold has become "plural" to meet
various tastes of contemporary smokers.
Creation of the cigarette takes place in this vast
making and packing room of P. Lorillard Com-pany's
plant in Greensboro, N. C. The overhead
feeder-conveyors carry the Lorillard blends here,
where they are fed into the cigarette-making
machines. As cigarettes shoot out of the ma-chines,
girls place them in "suitcase" containers
on automatic conveyor which takes them to pack-inq
department. This is the heart of the Greens-boro
plant—where cigarettes are created at the
explosive rate of 1,200 or more per minute, per
machine.
End of production line where cases containing 60
cartons of Old Gold, Newport and Kent cigarettes
stand ready for shipment in P. Lorillard Com-pany's
Greensboro, N. C, plant shipping room.
Stacks of cases will be transported on their
pallets automatically to special railroad and truck
docks for shipping. To ensure freedom from trans-portation
blocks, raw materials enter plant at
receiving areas on west and north sides and,
after passing through processing and manufac-turing,
the finished products emerge,, packaged
and encased, on the west side, close to receiving.
PAGE 14 THE E. S. C. QUARTERLY WINTER-SPRING, 196C
the impact that the magazine article
had on their fortunes, but, as one tobacco
man explains, "Lorillard's so-called luck
was just the arrival of an opportunity
for which it was prepared."
To supply the soaring demand, the
company installed new machinery at its
Greensboro, N. C, and Louisville plants
and kept them going around the clock.
And, though Kents had to be allocated
to customers, the cigarette manufacturer
never let up on its promotional efforts.
On the contrary, it expanded them.
Kent sales tripled from 1957 to 1958
and the brand had become a leading
seller in several important markets by
early in the latter year. Kent sales
reached 37.5 billion units in 1958, up
from a little over 3 billion in 1956.
Within the past few years, Lorillard
introduced Newport "with a hint of
mint" and added Old Gold Straights to
Old Gold Kings and Old Gold Filter
Kings. In July of this year, it bowed
Spring, a mentholated filter-tip cigarette
with Micropore paper. While the com-pany's
regular cigarette is experiencing
the effects of a declining market for that
type of product, its filter and mentho-lated
brands are doing well in these ex-panding
markets.
Wall Street Report
Last month, a Wall Street firm issued
a report on the P. Lorillard Co. which
stated
:
"Between mid-1957 and late last year,
sales and particularly earnings of this
fourth largest factor in the tobacco
products industry recorded rather spec-tacular
gains. The factor primarily re-sponsible
for the sharp improvement in
operating results, of course, was the vast
upsurge in sales of the company's Kent
"*r.waaoty,Na.4, Chatham (rreet.ncar the Gaol R) Peter and George fWillard
' :S Snuff of the befi quality Is' (la
iuf;taory,No.4, tree'
wb
Cos tobacco,
< 'mm ii kitefoot dr..
Common fmoakingdo
.ViMr. do.
I.adic twift Ho.
m.iy bv- had is follows
Prig or carrot do.
Maecuha muif,
Rapper do.
Slralburghdo.
Common rappee do
P.gta.l do. in fmall rolls, Scented rappee do. of dif-
"-7 1 "- ferine kinds,
HogtaitdO.
\ Scotch Ho.
The above Tnbjcc* and Snuff will be fold reafonable
and warranted :>•, good as any on the conrincnl found If not to prove good, any part of it ma, be returned, if nor <Un).!y,e(f. '
N. B. Proper jllowance will be made to thofc that pnrtfWi* .! quantity. M*,. . »
cigarettes, which rose from a relatively
minor item to become the country's fifth
best-selling brand. Sales of Kents, which
amounted to less than 3y2 billion units
in 1956, were running at the annual rate
of close to 40 billion units by late 1958.
Thus, the company's dollar sales rose
from $203 million in 1956 to $479 million
last year.
Bigger Profit
"The sharp increase in sales volume,
together with the transfer of a large
part of the company's operations to the
new and efficient Greensboro plant and
the June 1957 price increase on non-filter
cigarettes, resulted in a substantial
widening of profit margins. The pretax
margin, which was 5%% for the first
half of 1957, had improved to over 12%
by the second half of last year; per share
earnings rose to $4.01 in 1958 from 6'
cents two years earlier."
The Greensboro plant to which this
report refers can produce more than 10(
million cigarettes in a single eight-houi
shift. It employs more than 2,000 people
With minor exceptions, it is a singk
level factory, so that the flow of tobaccc
in its various stages is not impeded bj
elevators or other floor-to-floor handling
It was named one of the ten "Top Plants
of 1956." by Factory Magazine.
This plant, which has an automata
climate control system to regulate tem-perature
and humidity and condition the
air throughout the entire plant, labora-tories
and offices, approaches automatic
manufacture.
Throughout every phase of processing
and cigarette manufacture—softening
—See P. LORILLARD CO., Page 22-
Oriqinal Lorillard Ad—1789,
WINTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 15
AMERICAN TOBACCO IN 1960
The American Tobacco Company,
which today derives 95% of its dollar
revenue from cigarette sales, has been
most closely identified with the cigarette
since its beginnings. These trace to a
small family business begun in 1865 by
Washington Duke and his sons, in Dur-ham.
In 1881 one of these sons, James
B. Duke, branched out from smoking
tobacco into ciga-rette
manufacture.
At first the little
firm's cigarettes
were hand-rolled
;
but by 1884 Duke
and his mechanic had
perfected James
Bonsack's "making
j^ 'SFIL machine." This per-j^^^
A| c (1 n o y
EL^WmI quantity production,
j. ^p M but also a popular
W*HML JmJM price for the ciga-duke
rette, in that era a
specialty item. Combined with the fine
Bright tobacco which was beginning to
be grown and cured in North Carolina,
Duke's innovations led directly to the
cigarette industry as we know it today.
_ In 1884, the year he brought the first
cigarette machine to production effi-ciency,
Duke opened a New York City
factory and used that center as his sell-ing
headquarters. Using essentially
modern methods of national promotion
and distribution, he won an impressive
share of the cigarette market and in
1890 formed a new corporation, The
American Tobacco Company.
The taste of American consumers, who
used pipe tobacco and snuff during co-lonial
days, and switched to chewing
tobacco and cigars for the most part
during the nineteenth century, does not
change overnight. In terms of per capita
poundage consumption, cigarettes were
not to draw even with smoking tobacco,
plug and cigars until 1921 or 1922. So
during the first three or four decades
of its corporate existence, The American
Tobacco Company became an important
producer of plug, smoking tobacco and
cigars. (By 1912, in fact, its American
Cigar subsidiary was bigger than the
parent company, employing 37,000 peo-ple
in 60 factories.) Around the turn of
the century, few brands were truly na-tional.
In consequence, American To-bacco's
brands in all divisions of the
tobacco market—including cigarettes
—
were numbered not by the dozen but by
the hundred.
A few of these old brands survive,
more as momentos of a vanished era
than as actively-promoted tobacco prod-ucts—
Sweet Caporal and Omar ciga-rettes,
Honest Long Cut, Tuxedo and
Serene tobacco mixtures. The company
no longer makes plug tobacco.
Some of the company's big cigarette
brand names had their origins many
generations ago. Lucky Strike, currently
among the leading regular-size cigarette
brands, took its name from the gold-rush
fever of the 1850s. Around that
time the name was used for a plug to-bacco
made in Eichmond by R. A. Pat-terson.
Still later, the name was applied
to a roll-cut Burley pipe tobacco and
in 1916 American's new cigarette, made
with the "It's Toasted" process, was
given the Lucky Strike brand name.
Over the years, the emphasis of Lucky
Strike promotion has been placed on the
Leaf types for cigarette blend are examined by American Tobacco executives. Left to right: Alan C.
Garratt, ACC Division Advertising Manager; Paul M. Harm, President; W. B. Young, Asst. to the
Senior Vice President; R. B. Walker, Vice President and Director of Sales; Alfred F. Bowden, Vice
President.
American Tobacco Company's headquarters at
150 E, 42nd Street. New York. Original "Tobacco Factory" of Washington Duke near Durham, Mr, Duke is standing by the entrance.
PAGE 16 THEE. S. C. QUARTERLY WINTER-SPRING, 1960
Reidsville cigarette plant of the American Tobacco Company.
cigarette's manufacture—"It's Toasted"
appears on every pack—and on the
quality of its leaf. Since 1944 the fa-miliar
initials "L.S./M.F.T." (Lucky
Strike Means Fine Tobacco) have also
been an integral part of the package.
Only two cigarette brands have ever
sold more than one hundred billion ciga-rettes
in a single year; Lucky Strike is
one of them.
The biggest American Tobacco Com-pany
brand is Pall
Mall. Although to-day's
king-size Pall
Mall cigarette dates
from 1939, the brand
name itself played
an interesting part
in the company's
earlier history. Dur-ing
the 1890s a very
considerable per-centage
of cigarette
sales were in the
straight Turkish category, and the origi-nal
Pall Mall was one of these. Shortly
after the century's turn it was acquired
by American Tobacco and a young
trainee, G. W. Hill, was placed in charge
of Pall Mall and a few other brands,
then of minor significance. It was Hill
who evolved the distinctive package
color later known as Pall Mall Red; and
it was Hill who departed from the
premium-coupon form of merchandising
in favor of straight advertising on mag-azine
covers. For many years Pall Mall
sold at a premium price—"A Shilling in
London, a Quarter Here" while cigarettes
generally sold at a clime. But the name
and the label design seemed right, in
1939, for the new king-size cigarette
with its modern blend. Events seem to
have indicated that it was; Pall Mall
has shown consistent growth ever since,
and is currently credited by an inde-pendent
analyst with the No. 1 position
among all cigarette brands.
Another brand originally made to re-tail
at a premium
price has evolved
into one of the
company's major
products: the
Tareyton cig-arette.
In 1913
Herbert Tareyton
was a de luxe
item, packaged in
lead foil, with a
white - and - blue
wrapper. It was HAHN
intended to lend indirect lustre to a high-grade
smoking tobacco of the same
name (Herbert Tareyton pipe tobacco
is still made by The American Tobacco
Company). Over the years it evolved,
first into a cork-tip cigarette (1924),
then into a tipped, king-size running
mate for Pall Mall (1940. Although the
tipped, nonfilter king-size Herbert Tarey-ton
is still an important brand, it has
been overshadowed in recent years by
Dual Filter Tareyton (1958). The last-named
cigarette brought an innovation
to the filter-conscious fifties—a dual or
compound filter whose inner component
uses activated char-coal
to produce a
high degree of mild-ness
in the delivered
smoke. A second fil-ter
brand, introduc-ed
in 1956, took its
brand name from a
radio-television show
long identified with
the company : Hit
Parade.
In the cigar field, CROWE
which accounts for perhaps 3.5% of the
company's dollar sales, the company's
big seller is Roi-Tan, largest-selling
brand in the lOtf class. "Roi-Tan," the
current advertising goes, "has more of
everything—including smokers." It also
has more shapes than its competitors in
the 10<^ field, five in all (Fresh Perfectos,
Fresh Bankers, Fresh Panetelas, Fresh
Blunts and Fresh Invincibles) . In addi
tion, Roi-Tan is marketed in two 54 sizes
(Cigarillo and Trump) and in a 4f
size (Golfer).
Ever since the founding of American
Cigar Co. in 1901 (that subsidiary has
HILL
Buyers follow the auctioneer as he works down o line of baskets spread out on an auction warehouse
floor.
//INTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 17
#*«s «*•***«>
SANDS
ong since been absorbed), American
robacco has held an important position
n the Bonded Clear Havana market. Its
>rands include La Corona, Antonio y
Cleopatra, Bock y Ca., and Henry Clay,
;hese comprising the
argest-selling Bond-ed
Clear Havana
line. A subsidiary
also manufactures
the Cabanas cigar,
which is made in
Havana.
Although smoking
tobacco sales are
relatively minor, the
company's price list
still includes 28
orands. As recently as 1954, there were
32, and in 1931, 126. The line leader is
Half and Half, whose name denotes its
Drigin as a mixture of two older smoking
tobaccos—the Lucky Strike Roll Cut
(Burley tobacco) and the old Bucking-dam
brand (Bright tobacco). And in
the premium-price field Blue Boar, still
blended with a special Virginia smoked
ham flavoring, is American's top entry.
The oldest product still made by the
company—and one of the best-known
tobacco products in history—is the fam-aus
"roll your own" Bright tobacco in
a sack: "Bull" Durham. There are still
men who prefer do-it-
yourself cigarettes
and who will smoke
no other than the
genuine "Bull" in its
historic muslin sack
with the ye 1 1 o w
drawstring.
Today American
Tobacco has four
large cigarette in-stallations
— each
comprising a factory,
one or more leaf stemmeries, and leaf
storage. These centers are located in
Richmond, Durham, Reidsville and Louis-ville.
In addition, the company's plants
include a smoking tobacco factory in
Richmond, and cigar plants in Phila-delphia,
Trenton, Charleston, Owensboro
and Wilkes-Barre, leaf prizeries and
storages in many localities. Its Research
Laboratory, which dates to 1911, is now
housed in a large and recently-expanded
structure in Richmond.
President and chief executive of this
big enterprise is
Paul M. Hahn. A
New Yorker by
birth and graduate
of Columbia Univer-sity
Law School,
Hahn's first con-tact
with American
Tobacco came dur-ing
the 1920s. At
that time he worked
for the corporation's
. e g a 1 counseling YOUNG
firm, and was assigned to American as
resident counsel. In this capacity his
iroad grasp of corporate problems was
recognized by then President G. W. Hill.
In 1931 Hahn was made Assistant to the
President and a Director. Shortly there-after
he became a Vice President. Dur-ing
his three decades as an executive
of American, Hahn has performed in
many capacities: as an administrator, a
"policy man," a public relations and
stockholder relations expert, and during
the 1940s as head of the subsidiary pro-moting
Pall Mall cigarettes. In 1953,
Hahn was a moving force behind the
establishment of Tobacco Industry Re-search
Committee, the industiy's effort
to sponsor impartial, independent scien-tific
research in the field of smoking and
health. In other ways, too, Hahn has
demonstrated his statesmanlike approach
to industry problems (he is the dean of
cigarette company presidents, having
headed American since 1950). The Amer-can
Tobacco Company's advertising
policy is his personal responsibility, and
through thick and thin he has kept his
advertising "in good taste, to match the
good taste of our products." He is mind-ful
of the historic role of the tobacco
tradition in the U. S., and has refused
to capitalize on antitobacco attacks as a
means to quick and easy sales. Appro-priately
for the President of American
Tobacco, Hahn himself smokes cigaret-tes,
a pipe and cigars.
Over the 70-year span of its corporate
existence, American Tobacco has had
Storage sheds of American Tobacco Company in Reidsville.
Durham plant of the American Tobacco Company.
^
PAGE 18 THEE. S.C. QUARTERLY WINTER-SPRING, 1960
Tarevfon S
OUAUUIfcH
/"s/tttxr
Brands of cigarettes manufactured by American Tobacco Company.
only five presidents. The founder was,
of course, J. B. "Buck" Duke. He was
succeeded in 1912 by Percival S. Hill
(who had begun as a drummer for Bull
Durham) and P. S. Hill was followed in
1925 by his son, George Washington Hill,
considered by many to be an advertising
woody midrib from the leaf. It embraces
the tobacco's long sleep in the quiet
storage sheds—two years or more. Then
the strip leaf, exactly blended by class,
grade and crop year, is delivered by the
American Suppliers Division to the fac-tories.
There the final blending of Bright,
Burley, Turkish and Maryland types
takes place under rigidly controlled tem-perature
and humidity. A gentle spray
adds a moisture-retaining agent to help
the blend keep its freshness. Before be-ing
shredded into the long, fine strands
that make it a cigarette mixture, the
strip leaf is flavored, tumbled together
and "bulked"—allowed to stand overnight
while the various oils and aroma mingle
and blend. And the manufacturing flow
chart provides for many tumblings and
retumbilngs so that the mix will be com-pletely
uniform from one cigarette to
the next.
Looking at a quality cigarette, it is
difficult to realize the many steps need-ed
to produce it. Between leaf buying
and final packaging, for instance, the
tobacco is blended no fewer than thirty-five
separate times—at the hundred-plus
company prizeries where leaf is received,
in the seven stemmeries, in the four fac-tories'
spreaders, cutters, dryers, flavor-ing
drums, and making machines.
In the stemmery alone the leaf is
Firing tobacco barn. While this is a wood burn-ing
barn, fuel oil and gas are used extensively
and some barns burn coal.
virtuoso without peer. Vincent Riggio
headed the company after Hill's death in
1946 and was in turn succeeded, in 1950,
by the present incumbent, Paul M. Hahn.
When George W. Hill ended the com-pany's
"one big brand" era in 1939 by
pitting Pall Mall against the field, in-cluding
his own Lucky Strike, he placed
the new king-size brand in a subsidiary
company with its own advertising staff
separate from that
of Lucky Strike.
Paul Hahn became
head of that subsi-diary,
and the custo-dian
of Pall Mall's
fortunes, in 1940.
And ever since that
year — except for a
wartime hiatus when
1j -**. mM advertising was sus- pended Pall Mall
FOURNIER has been forging its
way toward the No. 1 position among all
cigarettes.
On the manufacturing side, the com-pany's
principal activity—the complicat-ed,
painstaking process of making quality
cigarettes—begins with sharp-eyed buy-ers
on the auction markets. It continues
through stemming, or removal of the
Examining tobacco inside the curing barn.
Preparation for stemming tobacco. Wooden hogs-heads
have been removed from this tobacco.
J
An average tobacco farmer and his family tie the leaves on sticks preparatory for curing in
/INTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 19
eam-cleaned seven times and is air-ashed
almost continuously, so that the
rip leaf delivered to the factories is as
ean and pure as man can make it. To
3 this, American Tobacco engineers
ave designed and built their own strip-ing
machinery.
Keeping the blend uniform is no simple
isk: so that the tobacco "lines" will be
le same at each of the four cigarette
inters, hogsheads of various grades, of
ifferent geographical classes, and from
;veral crop years must frequently be
vuttled from one location to another.
The factory itself is a giant air-con-itioned
humidor where temperature
tust be just right at every stage. Hu-ddity
is controlled so that moisture con-
>nt in the leaf is maintained within a
derance of one-tenth of one percent.
And when the blend finally reaches the
taking machines, the length and dia-leter
and weight of each cigarette are
"Twenty to the pack" machine in action.
mtrolled just as precisely by a battery
f detectors, feeders and regulators.
Looking at the final product, the re-alts
of all this are not, for the most
art, visible to the naked eye. But among
le nation's 58,000,000 cigarette smokers
here are many mil-ons
who can per-eive
them by taste,
'hese are the people
dio keep The Amer-an
Tobacco Com-any
in business.
Owned by some
5,000 stockholders
the average com-lon
stockholding is
i shares) , Ameri-in
Tobacco employs TURNER
7,000 persons in this country. Like
)bacco-making itself, employment with
ie company is something of a tradition
:
vo out of every three regular employees
[ the cigarette installations have been
rtK The American Tobacco Company
in years or more; 20% have service
icords of over twenty-five years. Most
nployees are in the four big cigarette
inters; a significant number are in the
af-buying division, American Suppliers,
hich purchases a quarter-billion dol-rs'
worth of tobacco in an average
?ar for use in the company's brands,
his leaf, most of which is aged two
kars or more before it enters the manu-cturing
stream, is stored in some 271
huge storage sheds in and around the
factory centers.
There is a special overseas subsidiary,
American Tobacco Company of the
Orient, Inc., which purchases Turkish-type,
aromatic tobacco in Turkey and
Greece.
Another subsidiary, J. Wix & Sons
Limited, manufac-tures
cigarettes in
London for the
United Kingdom
market. Another, the
Cuban Tobacco Com-pany
Inc., purchases
Havanan leaf for
use in cigars and
also has manufac-turing
plants of its
own.
One measure of
the size of the American Tobacco organ-ization
is its dollar sales, reported as
$1,103,023,397 in 1958 and even more
in 1959. Another is the fact that in each
of the last ten years, the company has
paid out more than one-half billion dol-lars
to the Federal and state govern-ments
for excise and income taxes. Dur-ing
the decade just ended—the 1950s
—
earnings increased by about 50%. This
progress is reflected not only in dividends
to stockholders but also in provisions for
WILLIAMS
Workers check weight cigarettes quality
testing.
the welfare of employees. Pending for
action at the annual meeting of April,
1960 is a new profit-sharing plan cover-ing
all regular full-time employees in
this country. This will be in addition to
retirement pay bene-fits
which have been
in effect for a num-ber
of years.
Headquarters of
The American To-bacco
Company are
in New York City,
in a gleaming stain-less-
steel skyscraper
across from Grand
Central Station.
Many of the corpo-ration's
directors make their offices there,
including those familiar to North Caro-linians.
John A. Crowe, Senior Vice
President, Manufacture and Leaf, is a
frequent visitor to the Durham and
Reidsville plants. Vice President Virgil
D. Hager, for many years manager of
the Durham factory, also makes his
SPARROW
office in New York, as does William B.
Young, originally of Reidsville and now
Assistant to the Senior Vice President.
Managing the Durham and Reidsville
factories are, respectively, Henry V. H.
Stoever, Jr., and Felix E. Fournier. Leaf
Division (American Suppliers) chiefs in
those towns are J. W. Williams and
Royal W. Sands. President of the Amer-ican
Suppliers Division, with his head-quarters
in Richmond, is George Turner,
a Director of the company. Also a
Director, and Vice President of Ameri-can
Suppliers Division is John B. Spar-row,
who operates
from a Durham
office. Guiding policy
for these executives
and for those who
work under them is
the traditional
phrase, "Quality of
product is essential
to continuing success." The company's
Indian symbol "Powhattan" is well-known;
not so well known is the fact
that it depicts the famous seventeenth-century
chief Powhattan, father of Poca-hontas
and known to legend as "The
Guardian of the Leaf."
POWHATTAN
Mr. Henry V. H. Stoever, Jr., manager of the
Durham branch of American Tobacco Company
is shown with packing machine operator.
PR-AMA
—Continued from page 11
—
589, Raleigh, N. C. There will be a
limited number of rooms at the YMCA
available for Wednesday and/or Thurs-day
nights. Room reservations must be
made directly with the Secretary,
YMCA, Raleigh.
The two Societies have, in the past
year, brought many top-flight PR prac-titioners
into the area to speak to the
public and their own members. These
organizations have probably done more
to establish the PR Profession in the
Carolinas as a reliable group of public
servants than any other effort in recent
years. Among prominent speakers
brought to the area are: Dr. Paul
Ylvisaker of the Ford Foundation; Fred
Johnson, formerly Chairman of PR,
Rexall Drug and Chemical Co., Cali-fornia;
Mel Emdee, VP of Creative Arts,
Washington, one of the top authorities
in film production; Henry E. Gellermann,
Director of PR and Advertising for the
Wall Street firm of Bache & Company;
and Paul V. Zucker, vice president of
the New York firm of Ruder and Finn.
PAGE 20 THEE. S.C. QUARTERLY WINTER-SPRING, 1960
TOBACCO'S LAND OF PLENTY
By James P. Richards
President, The Tobacco Institute, Inc.
When it was suggested that I prepare
an article for this special tobacco issue
of The E.S.C. Quarterly, I was interest-ed
and pleased.
Quite apart from my association with
the Tobacco Institute, I have always had
a keen interest in the development of the
industry in my neighboring state. The
paramount place North Carolina has long-held
in tobacco agriculture and tobacco
manufacturing is something to admire.
We grow flue-cured tobacco in my
home state of South Carolina and a good
deal of it, too. I know something about
tobacco farming and its economic im-portance
to the state. We don't manufac-ture
cigarettes—that is left to the ex-perienced
and well-established factories
in North Carolina, Virginia and Ken-tucky.
But we do manufacture several
hundred million good cigars each year.
We at the Tobacco Institute have been
particularly interested not only in the
economic but also the historical and cul-tural
role tobacco has in America. I
knew North Carolina was represented in
a good deal of historical material. So as
a basis for this article, I asked for some
of the pertinent facts. I was hardly pre-pared
for the wealth of historical and
economic information that was turned
up about the Old North State.
Only a small part of that information
can be recounted here. The full story of
tobacco in North Carolina could well fill
several volumes, and I am sure that this
issue of the Quarterly will contain the
most relevant material.
EDITOR'S NOTE
James P. Richards of Lancaster, South
Carolina, was serving as Chairman of the
House Committee on Foreign Affairs when
he retired from Congress, without seeking
re-election, at the end of the 84th Con-gress,
January 2, 1957. He had represented
the Fifth Congressional District of South
Carolina continuously since being first
elected in 1932.
On January 7, 1957, he was appointed
by President Eisenhower as special assist-ant
to the President with personal rank
of Ambassador. In this capacity his duties
were to advise and assist the President
and Secretary of State on plans to im-plement
the Eisenhower doctrine. After
carrying out a special mission last spring
to the Middle East, he undertook another
assignment in the Pacific area which he
has recently completed.
Mr. Richards served as a delegate to the
Japanese Peace Treaty Conference in 1951.
He was chairman of a Joint Congressional
Study Mission sent to Europe in 1951 at
the request of General Eisenhower. He was
United States delegate to United Nations
8th General Assembly in 1953.
A native of South Carolina, Mr.
Richards was born in 1894 and graduated
from the University of South Carolina,
which in 1955 conferred upon him an
honorary LL.D. degree.
Mr. Richards is a veteran of World
War I, is married and has two sons and
one daughter.
Despite its importance in the tobacco
economy today, North Carolina is a rela-tive
newcomer.
A year after the War Between the
States ended, production of tobacco in
North Carolina totaled only 7,840,000
pounds. In 1959, the state's tobacco har-vest
was very nearly a hundred times
that of 1866, or over 776,000,000 pounds.
Not a single cigarette had been com-mercially
manufactured in North Caro-lina
by 1866. But in 1959 its "making"
factories had turned out well over half
of the 488 billion cigarettes produced in
the United States.
Between these dates lies a near- cen-tury
record of agricultural and manu-facturing
development of tobacco in
North Carolina.
The Long Road to Success
Virginia and Maryland, it will be re-membered,
began their economic careers
as tobacco-producing colonies. That was
not so of the Province of Carolina. The
now long-established status of North
Carolina as the world's major producer
of cigarette leaf and of cigarettes was,
chronologically, a late achievement. It
was almost 275 years after Spanish
colonial seeds were, around 1612, first
planted in Jamestown before the Tar
Heel State began to assume importance
in the tobacco economy.
Once that development began, the
quality of North Carolina leaf and the
energy of local manufacturers rapidly
carried the state to first place in the to-bacco
industry.
During that progressive development,
while superior leaf and superior tobacco
goods were being produced, the brand
names of smoking tobaccos and cigarettes
manufactured in North Carolina became
known around the globe. Outstanding
men in the state created a great indus-try
and many became world-famous. In
the process they also increased the wealth
of the community and made valuable
contributions to its culture.
The Seedling Years
Looking back briefly, it is interesting
to note the conditions under which North
Carolina began. When the establishing of
a colony adjoining southern Virginia was
being discussed, in 1662, the noblemen
requesting a land grant stated that set-tlers
would not grow tobacco in the
new province in competition with plant-ers
in Virginia and Maryland. These two
colonies were then going through a re-current
depression owing to overproduc-tion
of their staple.
But settlers from Virginia and Scots-men,
Germans and others from southern
Pennsylvania had been moving into the
Carolina area from 1660 on. They were
soon producing an excellent type of to-bacco.
A few years later Virginia penal-ized
its unwanted stepchild by prohibit-i
RICHARDS
ing entry of North Carolina tobacco int(|
its dominion.
English Rules and Economic Laws
The England traders, who had mor(|
influence in directing the new province
than the Lords Proprietors of Carolina
thereupon shipped Carolina tobacco di
rectly to Scotland and the Continent. Ii
these operations they were violating th<
Navigation Acts which required colonia
tobacco to be landed first in Englisl
ports. And Dutch merchantmen, alway:
eager at that period to annoy the Eng
lish, frequently slipped into that "refugi
of pirates," Rogue's Harbor (AlbemarL
Sound), and took out shiploads of goo<
leaf.
Under the influence of the shrew<
northern traders Carolina's tobacco pro
duction could well have increased. Ther'
was, however, an economic situatioi
which intervened: too much leaf fron|
Maryland and Virginia in English an<j
European warehouses to warrant largej
scale production in Carolina. Throughou
the colonial period, therefore, tobaccj
cultivation in the Province remained
fairly limited and sporadic.
Bright Spot in Tobaccoland
The conditions which altered the agri
cultural and manufacturing characteris
tics of North Carolina were numerou
Only the major ones need be indicate!
here.
By the early decades of the 19th cen
tury there had been a mass swing awa;
from snuff. There was a wide-scale re
vival of interest in pipe smoking. Wit
it came a consumer demand for a mor
aromatic, lighter-colored leaf than thai
produced in Virginia and Maryland.
After some experimentation, it wa
found that the sandy soil of the centr;
—See LAND, page 24—
WINTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 21
THE RESEARCH PROGRAM OF THE TOBACCO INDUSTRY RESEARCH COMMITTEE
By Timothy V. Hartnett
Chairman
In January 1954 an event unique in
the history of American industry—and
possibly in science too—took place when
representatives of tobacco manufac-turers,
growers, and warehousemen es-tablished
the Tobacco Industry Research
Committee. Representatives of North
Carolinas tobacco economy participated
in this new undertaking that was to
contribute greatly to scientific advances.
One member of the TIRC form the for-mation
was North Carolina's Fred S.
Royster of Henderson, managing direc-tor
of the Bright Belt Warehouse Associ-ation.
Representatives of leaf groups in
other states, as well as most major to-bacco
companies, also were among the
founders.
Purpose of the Tobacco Industry Re-search
Committee is to support research
by independent scientists into questions
relating to tobacco use and health, par-ticularly
lung cancer and heart disease,
and to make the facts known to the
public.
In the few months preceding the in-dustry's
action questions had been raised
about tobacco use. There had been pub-lic
attention—some of it of sensational
nature—to statistical reports linking
smoking with lung cancer.
But there was a great deal of doubt
among doctors and scientists as to the
meaning and validity of these reports
and similar ones that were to follow.
It soon became apparent that tobacco
was just one of many factors being
studied by scientists as possible suspects
in lung cancer and heart disease. Point-ing
the finger of suspicion solely at to-bacco
did not sit well with those who
were aware of the many factors that
might be involved. But the publicity was
concentrated on tobacco—especially by
anti-tobacco elements who adopted the
health charges to back their campaigns.
Before long it was quite clear that
scientific knowledge about the effects, if
any, that tobacco might have on humans
was limited and often confusing. It was
to help science fill in these many wide
gaps that the Tobacco Industry Research
EDITOR'S NOTE
Mr. Timothy V. Hartnett, Louisville,
Ky., was named full-time chairman of the
Tobacco Industry Research Committee in
July 1954.
Mr. Hartnett had just retired as presi-dent
of the Brown and Williamson Tobacco
Corporation, a position which he had held
since 1941. He has been associated with the
tobacco industry for 50 years.
The Tobacco Industry Research Com-mittee
was formed early in 1954 by cigar-ette
manufacturers, organizations of to-bacco
growers and warehouse associates
to sponsor research into all phases of
tobacco use and health.
TIMOTHY V. HARTNETT
Committee undertook its research pro-gram—
and therein lies the uniqueness
of this industry effort.
The Scientific Advisory Board
Within a few months after its estab-lishment,
the TIRC invited doctors and
scientists well known for their work in
cancer, heart disease, and other ailments
to serve on a Scientific Advisory Board.
Among them is Dr. Kenneth Merrill
Lynch, president of the Medical College
of South Carolina at Charleston, who is
presently chairman of the Advisory
Board.
Now consisting of 10 scientists who
still maintain affiliations with their re-spective
institutions, the Board has
responsibility and authority to develop
and direct the TIRC's research program.
The Board itself does no research for
the TIRC, and the TIRC does not operate
any facility or laboratory for research.
I have been privileged to be chairman
of the Tobacco Industry Research Com-mittee
since mid-1954, and I have watch-ed
with admiration and gratitude the
dedication and efforts of the men on the
Scientific Advisory Board. They have
taken their considerable knowledge and
experience and abilities, and coupled
them to a desire to find the truth—and
that is the basis of the research pro-gram
they are guiding.
The research supported by the TIRC
is conducted by independent scientists
who receive grants-in-aid from the Sci-entific
Advisory Board. The scientists
are given complete scientific freedom in
doing their studies and in reporting or
publishing their findings in the accepted
scientific manner—through medical and
scientific journals and societies.
One measure of the progress of the
industry's extensive research program
can be seen in these figures : through
1959 the Board had recommended
grants to 90 scientists in 61 hospitals,
universities and research laboratories
throughout the country from funds that
so far total $3,700,000 appropriated by
the TIRC.
Perhaps a more significant measure
is seen in the fact that these scientists
have published over 100 papers in medical
and scientific journals describing their
work under grants they have received
from the TIRC.
These reports are providing new and
valuable information in the search for
knowledge about tobacco use and health.
"Tripod" of Speculation
I think it pertinent at this point to
refer to the recently issued 1959 Report
of Dr. Clarence Cook Little, scientific
director of the Tobacco Industry Re-search
Committee and world-known can-cer
research scientist. Dr. Little notes
that the charges against tobacco as a
cause of lung cancer rest on a "tripod"
of speculation—statistics, pathology, and
animal experimentation. He considers
each "leg" of the tripod and makes these
points:
1. Statistics. There has been consid-erable
analysis of statistical studies pur-porting
to show an association between
smoking and certain causes of death and
much disagreement over their meanings.
Dr. Joseph Berkson, head of the Sec-tion
of Biometry and Medical Statistics
at the Mayo Clinic, Rochester, Minn., is
one doctor who has published several
papers relating to statistical studies of
tobacco and lung cancer.
Dr. Berkson is among the many who
have stated that statistical findings do
not show that smoking causes lung can-cer.
This disease, he said, is basically
a biologic, not a statistical problem, and
the statistical claims have not been con-firmed
by experimental and direct ob-servational
studies. There is, he said,
virtually no substantial clinical, path-ologic
or other direct evidence to show
that smoking is the cause of lung cancer.
Another scientist who has commented
at length on statistical claims is Sir
Ronald Fisher, a former Arthur Bal-four
professor of genetics at the Uni-versity
of Cambridge, England.
Sir Ronald has pointed out the statis-tical
work of two British investigators
whose data indicated that inhalation of
cigarette smoke actually seemed to di-minish
the change of lung cancer in the
population studied.
Sir Ronald, commenting on this, wrote
:
"There is nothing to stop those who
greatly desire it from believing that
lung cancer is caused by smoking cig-arettes.
They should also believe that
inhaling cigarette smoke is a protection.
To believe either is, however, to run the
risk of failing to recognize and, there-
PAGE 22 THE E. S. C. QUARTERLY WINTER-SPRING, 1960
fore, failing to prevent other and more
genuine causes."
2. Pathology. Very early in its pro-gram,
the Scientific Advisory Board to
the TIRC sponsored a long-time study by
the pathology of human lungs by 12
leading pathologists in different parts
of the country. All these pathologists
found various lesions frequently in lungs
of non-smokers as well as in smokers, in
persons of both sexes and of all ages and
of different places of residence. What
such conditions mean and what brings
them on is a matter of continuing study.
3. Animal experimentation. Of signi-ficance
are the continuing reports of
failure to induce lung cancer in animals
with direct inhalation of cigarette smoke.
In this type of work smoke itself is used
and the tissue challenged is lung, not
skin, tissue. While such animal work is
suggestive, scientists generally do not
apply findings with mice directly to man.
Other Factors
Extensive research from scientists
throughout the world has shown that
many factors may be involved in lung
cancer and heart disease. Among these
are heredity, infection, nutrition, hor-mones,
nervous strain or tension, and
environment. And perhaps other also
are involved.
Journal of the American Medical Association
In mid-December of last year, the
Journal of the American Medical As-sociation
had an editorial on "Smoking
and Lung Cancer" that said in part:
"Neither the proponents nor the oppon-ents
of the smoking theory have suffi-cient
evidence to warrant the assumption
of an all-or-none authoritative position."
The editorial referred to an article
two weeks previously by Surgeon Gen-eral
Leroy E. Burney in which he said
the evidence to date implicates smoking
as the principal causative factor in the
increase in lung cancer.
However, the editorial pointed out
that "A number of authorities who have
examined the same evidence cited by
Dr. Burney do not agree with his con-clusions."
Beliefs of the TIRC
In his 1959 Report, Dr. Little discussed
the various aspects of tobacco and health
from the scientific standpoint. He noted
that many persons, both intelligent lay-men
and scientists, will not accept a
simple cause and effect relationship in
cancer and heart disease unless such a
relationship can be proved by something
more than disputed statistics, transferred
interpretation from animal work, or
limited autopsy findings. Neither will
they reject a possible role for tobacco
along with other environmental expos-ures,
until evidence permits a true evalu-ation.
Dr. Little said the experiences of the
period since the Tobacco Industry Re-search
Committee was established amply
justify and support these beliefs held
by the TIRC and others:
1. Any role of cigarette smoking in
lung cancer and certain other dis-eases
has not been proved as causa-tive.
2. If tobacco has any role, it is un-certain,
unidentified and unanal-yzed.
3. Much more research is needed to
help clarify and define the signifi-cant
problems, and to determine
the best way to find the answers to
them.
4. All evidence, including that which
demonstrates the gaps and un-certainties
and contradictions in our
knowledge, should be presented to
the public honestly and fully. The
individual can form his own con-sidered
opinion only on the basis of
complete information.
In closing, I wish to emphasize that
the Tobacco Industry Research Commit-tee
will continue with its research pro-gram
that is aimed at helping to find
the answers to questions about tobacco
use and also to contribute in every way
that it can to improvement of the public
health.
P. LORILLARD COMPANY
—Continued from page 14
—
blending, bulking, mixing, flavoring, cut-ting,
drying, making, packing—auto-matic
controls or recording devices keep
constant vigil to ensure uniform quality
to tobacco and cigarettes. From the
moment the giant hogsheads of tobacco
move on automatic conveyors into the
processing area, until the time the
finished cigarettes roll out of a making
machine at a rate of 1,200 a minute,
there is no need for a human hand to
touch the tobacco. Everything is handled
automatically on specially-designed giant
conveyors, from one stage to the next.
Built for Flexibility
Because of rapid shifts in smokers'
tastes—and since king-size, filter-tip and
regular cigarettes require different ma-chines
and different layouts—the plant
was conceived and built for the utmost
flexibility. Huge 40 feet by 54 feet bays
in the cigarette-making room permit
movement of machinery around at will.
Air-conditioning and other service
lines are above the sixteen foot ceiling
and overhead busducts permit electrical
connections to be plugged in virtually
anywhere.
A visitor to the plant is immediately
struck by its vastness, stretching as it
does more than a fifth of a mile from
east to west, facing U. S. Highway 70.
Its total area is more than 600,000
square feet and the packing room covers
approximately 3% acres, or enough
space to accommodate three football
fields.
Research Facilities
The research division is equipped with
the most advanced devices for scientific
tobacco research and includes seven labs
plus an engineering laboratory for ex-perimental
work on new types of pro-duction
machinery.
The control laboratory tests every-thing
that comes into the plant and
everything that goes out of it—cigarette
paper, humectants, colors of packages,
flavors, wrappings, etc.—to see that all
come up to the Lorillard standards. It
also makes continuous tests on Loril-lard
and competitive cigarette brands.
The smoking laboratory keeps a con-stant
check on the draw of the Lorillard
cigarettes, both filter and non-filter; sees
that the filters are doing the job for
which they are designed. The organic
research laboratory engages in funda
mental research into the basic constitu-ents
of cigarette smoke, using a Loril
lard-designed 36-unit "smoker" which is
continuously "puffing away" at three
dozen cigarettes at a time.
The leaf analysis and special projects
laboratory analyzes all the leaf tobacco
purchased by the company and tests
samples of leaf prior to leaf market
opening to give the company's leaf men
an indication of what and where to buy.
This laboratory follows samples of the
various tobaccos through the aging
processes, to determine what happens to
the tobacco at every stage; it then sets
the precise period for perfect aging of
each batch, instead of using arbitrary
time limits for this process.
The Kjeldahl and titration labs deter-mine
nicotine and nitrogen content of
various tobaccos and the quality control
lab follows the tobaccos and cigarettes
through various stages of manufacture
to keep a rigid check on such factors as
moisture content, weight and density
filter draw and seal on wrappings.
Huge Operation
The P. Lorillard Co. of today is a
national firm on a scale that its origina
tors could never have possibly conceived.
From the Lorillard Building, a sky-scraper
at 200 East 42nd Street, New
York City, into which the company
moved its headquarters last year, _ its
executives are in constant communica-tion
with factories and leaf plants in
the Southland and with the many
hundreds of members of the sales organ
ization. These latter keep Lorillard
products on tobacco retail counters, in
food and drug stores, in vending ma-chines
and, in fact, in virtually all of
the 1,400,000 retail outlets through
which cigarettes now are sold.
More than ever today, when dozens of
brands and types of cigarettes compete
for the favor of American smokers, the
Lorillard sales organization plays a vital
role in the company's planning and
policies. Working in coordination with
the company's advertising and market-ing
men, the headquarters and field sales
forces see to it that the Lorillard brands
are available when and where the con-sumer
wants them.
The company today follows the same
basic principles laid down by the found-ing
Lorillard family: "Make the best pos-sible
product; advertise it so everyone
will know it's available; keep making i1
better."
—See P. LORILLARD CO., page 24-
WINTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 23
Robersonville's Southeastern Tobacco Company is Located in the Heart of the Belt
Southeastern Tobacco Company, Rob-ersonville,
North Carolina is ideally and
centrally located in the heart of the
largest tobacco belt. Established in 1918
and previously operated under other
management, this company was re-or-ganized
for improvement in 1944; since
then it has become the present-day
Southeastern Tobacco Company.
Services rendered by Southeastern To-bacco
Company are many. Beginning
with the Georgia and Florida openings,
Southeastern buys for various accounts
through its organizations located in
Statesboro, Claxton, Metter, and Alma,
Georgia. Some of the tobacco bought in
Georgia is shipped to customers in Vir-ginia,
the Carolinas, and Kentucky for
the manufacture of cigarettes. Part is
shipped to their dealer and export cus-tomers,
and the remaining is kept by
Southeastern in Eobersonville for their
own use in redrying and reselling. Also,
along with types of bright leaf tobacco
from North Carolina, some is shipped
after being baled to parts of Pennsyl-vania
for cigar purposes. Experienced
buyers man these markets being sent
from Robersonville to buy to the exact
specifications of the customers.
When the Carolina markets open,
these men and other personnel return
to Robersonville and outlying markets in
the Carolinas to begin the buying and
redrying process over again.
Southeastern has facilities to redry
125,000 pounds of green tobacco daily.
This tobacco is purchased and graded
with extreme care. Then it is picked and
blended and redried. After the redried to-bacco
is packed in containers, it is weigh-ed
and tagged for shipment or for
storage. Southeastern has ample and
modern storage facilities to accommo-date
its customers. At Southeastern no
order is too large or too small to be
given the best attention of the com-pany's
experienced personnel; and South-eastern
can pack all types of tobacco
suitable for foreign and domestic trade.
After the Eastern season closes South-eastern
Tobacco Company makes its buy-ing
facilities available to customers in
the Burley tobacco district. They cover
markets in Madison, Indiana; Ripley,
Ohio; and Covington, Kentucky. Buying
orders are solicited and welcomed on
these markets.
To regular customers and other in-terested
firms Southeastern offers a com-plete
sampling service. Much care is
taken to see that samples are fully rep-resentative
of the lots of tobacco sampl-ed.
Upon request samples are promptly
dispatched with a written note that order
and packing of all lots are guaranteed.
Southeastern is staffed with people
who know tobacco. Oscar Burch is presi-dent
and manager. J. Elliott Barnhill is
assistant secretary and treasurer. J.
Hubert Williford is factory superinten-dent.
Buyers are Billy N. Warren, John
D. Jenkins, and Melvin G. Farmer.
Others working at Southeastern are
Billy J. Crawford, receiving and ship-ping;
John M. Matthews, processing; and
Shelby A. Council, office. In addition to
these year-round employees, the com-pany
hires about 250 workers seasonally;
and during the past four years South-eastern
has paid out approximately
Tobacco arriving at plant for processing from the various markets.
Side view of Southeastern Tobacco Company, Robersonville.
Regrading leaf tobacco for processing,
PAGE 24 THE E. S. C. QUARTERLY WINTER-SPRING, 1960
$400,000 in wages and salaries. So be-sides
the good business reputation this
company maintains, it is also an econ-omic
factor in the financial welfare of
Robersonville.
As packers, dealers, and exporters of
all types of leaf tobacco, Southeastern
Tobacco Company is a thriving business
and a credit to the tobacco industry.
LAND OF PLENTY
—Continued from page 20
—
Virginia-North Carolina area produced
the lightest, brightest leaf. The area,
limited in extent, became known later as
the Old Bright Belt.
Then, apparently as the result of an
accidental discovery, it was found that
charcoal used in open fires cured the
leaf to a "proper yellow." The farmer,
Abisha Slade, in whose barn in Caswell
County the discovery had taken place
in 1839, became an active missionary for
charcoal curing.
After the War Between the States in-terest
was revived in an experimental
method of curing through heat con-ducted
by flues. The imperfect flues of
the pre-war period were improved and
open-fire curing was discarded. At that
time in North Carolina's history the
most important agriculturist was Major
Robert L. Ragland. He was a scientific
breeder of Bright tobacco, the developer
of a basic curing formula and a teacher
of farmers. By the time he had com-pleted
his work, flue-cured leaf was well
on its way to becoming the world's lead-ing
tobacco type. And the major concen-tration
of the type was in North Caro-lina.
Machines and Men
Meanwhile, cigarettes were moving up
in production. They first reached the
billion mark in the United States in 1885.
Machinery was being used in the manu-facture
of chewing and smoking tobacco
and in packaging the latter. The most
important mechanical discovery of the
period, in relation to the tobacco indus-try,
was the invention of James A.
Bonsack, then in his late 'teens. He
patented a cigarette-making machine in
1880. It was soon in practical use in
North Carolina. After some adjustments
and improvements were made, the mech-anism
could deliver 120,000 cigarettes in
a working day. This quantity equaled
the labor of 40 or more hand rollers.
All the elements for an increase in the
production of cigarettes were now avail-able
: a highly desirable leaf, a cigarette-making
machine which worked, excel-lent
transportation facilities, a depend-able
labor market, a number of energetic
manufacturers—and a consumer demand
which continued at a slow but steady pace
up to the period of World War I. Then,
after the war, the rate growth of the
cigarette industry became spectacular.
Tobacco was the basic commodity of
the first American colonial enterprise.
For a long time now the business of pro-ducing,
manufacturing and merchandis-ing
tobacco has been a major industry
in the United States.
Yet, during these busy years of growth,
the social uses of tobacco have often
come under attack. This was hardly a
novelty; the first attack against smok-ing
started some 350 years ago. Since
then the hate campaigns against tobacco
have come in cycles and based on various
reasons. Critics were always more out-spoken
than tobacco's admirers, although
literature abounds with poetry and
prose praising tobacco as giving solace
and inspiration.
When in 1958 The Tobacco Institute,
Inc. was formed, among its purposes
were to promote better public under-standing
of the tobacco industry and its
place in the national economy, and to
compile and disseminate information re-lating
to the industry and to the use of
tobacco products.
The Institute is comprised of the major
tobacco manufacturers in the United
States. These firms produce about 99
percent of the nation's tobacco goods. In
the course of its operations the Institute
has published an illustrated brochure,
Tobacco—A Vital U. S. Industry, a port-folio
of individual reports on manufac-tured
products and other informational
material.
The subject of North Carolina has a
prominent place in these publications.
For there is no basic phase of the indus-try
in which North Carolina does not
share. And, as other articles in this issue
of the Quarterly indicate, its share is
predominant in many areas of agricul-tural
and manufacturing activity.
Some data, derived chiefly from the
Institute publications, will be of interest
here. These go beyond mere statistics.
For it should be remembered that tobac-co
cannot grow long by itself. It is not
machines alone that produce goods. Be-hind
the hard figures lie people.
The Broad Scale of Operations
There are, for instance, around 750,-
000 farm families in the tobacco-growing
districts of the United States. The big-gest
community of tobacco farmers is in
North Carolina. Together with their
many helpers they produce the major
portion of the 1,079 million pounds har-vested
in the United States in 1959 from
696,300 acres. This abundant cash crop
is now bringing over $1 billion to its
growers.
From the time that tobacco goes to
market, its care and disposition re-quires
a very large labor force: auc-tioneers
and warehouse workers, men
and women in stemmeries, men in prizer-ies
and redrying plants and transporta-tion
services. These operations of the
industry take place in 166 communities
where some 900 auction warehouses are
located.
—See LAND, page 26—
P. LORILLARD COMPANY
—Continued from page 22
—
History of Tobacco
The history of P. Lorrillard Co. is vir-j
tually the history of tobacco manufac-ture
in America. Pierre Lorillard opened
his shop and factory in 1760 on New
York's Chatham Street and his business
got its first big spur from the American
Revolution which cut off tobacco im-ports
from England.
The family dynasty had its beginning
when he brought his sons, Peter (Pierre
II) and George into the business in 1780.
They put the firm into real mass produc-tion
and made its products nationally
known.
In 1789, the brothers published the
company's first known advertisement in
New York's "Daily Advertiser." From
this ad developed the Lorillard principle
"advertise the product so everyone will
know it's available."
Three years later, they moved their
main factory to the wooded banks of the
Bronx River and built a new snuff mill
that harnessed the swift-flowing waters
to turn the wheels of its machinery. This
mill was to be the heart of the Lorillard
empire until manufacturing was aban-doned
there in 1870.
In the 1820's and 1830's Peter and
George Lorillard printed thousands of
broadsides listing their products and in-vited
every postmaster in the United
States to handle them. Hundreds agreed
and national distribution of branded to-bacco
products was achieved for the first
time.
Pierre Lorillard III took over the reins
of the business in 1843 after his father
and uncle had passed away. He expanded
the business and shifted production
more and more to chewing and smoking
tobaccos. In 1870, the main manufactur-ing
facilities were relocated in Jersey
City, N. J.
Adopted Tin Tag
Troubled by imitators of his plug
brands, Pierre III clamped a tin tag to
his tobacco and introduced the appro-priately
named brand, Tin Tag. In 1890,
plug was the most important branch of
the industry next to cigars and because
of Lorillard's importance in this field,
Pierre IV insisted that the family name
be continued and the business operated
as a separate organization when the to-bacco
trust was formed.
The dissolution of the trust in 1911
gave Lorillard, in addition to its manu-facturing
properties and its various to-bacco
and cigar brands—Van Bibber and
Between the Acts—the Murad, Helmar
and Egyptian Deities cigarette brands.
The nation's oldest tobacco manufac-turer
entered the blended cigarette busi-ness
in 1926 with the introduction of Old
Golds. Initial marketing efforts included
the "Blindfold test," the use of cello-phane
wrappers, the first coast-to-coast
radio hookup, Old Gold puzzle contests
and such slogans as "Not a Cough in a
Carload."
The Old Gold established Lorillard as
—See P. LORILLARD CO., page 25—
WINTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 25
E. V. Webb & Co., Inc., is Kinston's Oldest Leaf Tobacco Firm, Established 1895
E. V. Webb & Company, Inc., was
originally established in 1895 and is the
oldest leaf tobacco firm operating in
Kinston. The plant is housed in a spacious
three story brick building, with all stor-age
facilities located on property ad-jacent
to the main factory building. In
addition to the regular operations of
hanging and packing tobacco in bundles,
this plant has facilities for screening
and picking Georgia leaves. Two Proctor
& Schwartz redrying machines prepare
the processed tobacco prior to its being-packed
in hogsheads for storage. In addi-tion
to this equipment, in 1956 E. V.
Webb & Company re-entered the stem-ming
field with the installation of mod-ern
stemming equipment. This equipment
has been modernized since that time with
the addition of the latest threshing and
separating equipment. This company
packs tobacco both in bundles and strips
on order and on speculation, for the
domestic trade as well as for many for-eign
customers scattered around the
globe. During the peak of the processing
season, running from the middle of
August to the middle of November, Webb
employs from 300/400 persons in the
factory operation. It's officers active in
the operation of the firm are Mr. William
B. Glenn, President, Thomas H. Harvey,
Jr., Vice-President, and Julian B. Mc-
Cullen, Treasurer & Assistant Secretary.
P. LORILLARD COMPANY
—Continued from page 24
—
a major manufacturer of blended cigar-ettes.
To the regular size was added the
post-World War II Old Gold King and
later the Old Gold Filter King. Kent
bowed in 1952.
Lorillard today produces, in addition
to its cigarette and cigar brands, Briggs,
Union Leader, India House, Friends and
other smoking tobaccos and Beechnut
and other chewing tobaccos.
Production facilities, other than those
in Greensboro and Louisville, are located
in Richmond and Baltimore. The Federal
Tin Co., a subsidiary located in Balti-more,
makes cans and containers and
prints wrappers for Lorillard products.
Leaf processing and storage plants are
ilocated in Danville, Va., and Lexington,
Ky., and facilities for leaf receiving,
[storage and re-shipment to production
plants are located in Madison and La-
Crosse, Wis., and Lancaster, Pa.
Produced Overseas
The company's leading cigarette
brands are being produced on a royalty
or license basis in the Philippines, Venez-uela,
Panama and Luxembourg and will
be so produced in other countries in the
future. Rigid specifications are set for
these companies by Lorillard and are
supervised by its own technical advisers.
Workers are here shown packing the redried bundle tobacco in hogsheads at the delivery end of the
machine. These cylindrical wooden containers are generally packed to a net weight of approximately
950 pounds. This is the standard package for shipping tobacco to the many countries abroad which
use American flue-cured leaf.
This view shows the full sticks of bundle tobacco being placed in position on the feed end of the
redrying machine.
Workers are shown blending and hanging bundles of tobacco on sticks in preparation for redrying.
PAGE 26 THE E. S. C. QUARTERLY WINTER-SPRING, 1960
improving Marketing Practices For Tobacco Show Up In New Problems, Standards
By J. H. Cyrus
Tobacco Marketing Specialist
N. C. Dept. of Agriculture
The tobacco industry, upon which the
North Carolina farm economy is rooted,
has experienced a major revolution dur-ing
the last decade. The revolution start-ed
in the early 50's when health scares
caused a radical
shift in consumer de-mand,
from no filter
to a filter type cig-arette.
This devel-opment
caught the
farmer off guard
and made it neces-sary
for him to
make rapid adjust-ments
to meet the
new market situa-tion.
However, these Cyrus
adjustments have not come easy, due to
other complicating problems facing the
farmer such as spreading disease prob-lems,
adjusting to new disease resistance
varieties, and adjusting to new culture
practices in general.
All of these developments have created
new marketing problems for the farmer
in addition to many of the old ones that
had not been solved. For example, the
revolution in market demand, new
varieties, and culture practices made it
necessary to make many revisions in the
U. S. Standard grades, upon which the
farmers' sale at the market is based. To-bacco
growers, who were not too familiar
with the Standards at the best, find that
the revisions in grades make the job of
preparing tobacco for market even more
confusing and many growers are satis-fied
to get what they can for their to-bacco
unsorted. Therefore, many of the
buying companies, especially the export
buyers, are very critical of the job that
many farmers are doing in preparing
their tobacco for market. At the same
time many growers are failing to get
the true market value for their tobacco.
Service Program
The Tobacco Section, which is a part
of the Division of Markets of the North
Carolina Department of Agriculture, con-ducts
a service program in cooperation
with the U. S. Department of Agriculture
under the Research and Marketing Act,
to assist flue cured and burley tobacco
farmers to get a better understanding
of the situation, and to improve their
preparation and marketing practices.
This program is conducted through or-ganized
group meetings and demonstra-tions
with vocational agriculture teach-ers,
county agents, and farm organiza-tions
throughout the flue cured and bur-ley
tobacco belts of North Carolina. Also,
the radio, television, newspapers and
magazines are used as a media to get
market information to farmers and
other interested persons.
This service program is divided into
two phases, pre-marketing and marketing-service,
in order to give farmers the
kind of assistance needed at particular
times of the year.
Pre-Morkering Service
The pre-marketing service is rendered
upon the request of various farm agencies
and organizations during the winter and
early spring months, while growers are
making plans and preparations for
another crop of tobacco. In these meet-ings
farmers are given a thorough analy-sis
of the current tobacco situation as
it relates to stabilization stocks, total
supply of tobacco on hand, domestic and
export disappearance, changes in con-sumer
preference and any other new de-velopments
in the industry. This brings
the farmers up-to-date with the current
problems facing them before they start
a new crop, and familiarizes them with
Three "hands" of cured tobacco. Difference in
grade may be seen even in this black and white
print.
the trends that will determine the market
demand during the following market
season. This gives the farmer a better
opportunity to adjust his practices to
the current situation before the crop is
started.
Marketing Service
During the years of World War II
when there was a scarcity of labor and
a short supply of tobacco, most farmers
got out of the habit of sorting tobacco
in uniform grades. The tobacco buyers
did not complain about un-sorted or
mixed tobacco during those years be-cause
of their desperate need for any-thing
called tobacco. However, those
years are far behind, even though many
tobacco growers are slow to realize that
fact, and the ever increasing competi-tion
from foreign producers of tobacco
makes it imperative that our farmers do
a better job in preparing their tobacco
for market. A marketing service is also
provided to aid farmers in improving
marketing practices in order to meet
foreign competition.
The preparation and marketing service
is rendered through the request of or-ganized
farm groups. This phase of the
program begins in July in the North
Carolina Border Belt and is continued
through the marketing season in the
various other belts of the state, and
ends in December in the North Carolina
Burley Tobacco Belt.
In these group meetings, farmers are
first familiarized with the basic factors
of the U. S. Standard Grades and brought
up-to-date with any revisions in grades.
Then they are shown through demonstra-tions
how to use a simple method of
farm sorting, which will make each lot
of tobacco uniform enough to fit directly
into one of the 172 U. S. Standard grades.
Farmers are then assisted in applying
the practice on samples of their own
crop of tobacco. Proper artificial light-ing
is also used to show farmers the
importance of good lighting in prepar-ing
tobacco for market.
Our tobacco farmers must realize that
our greatest defense against foreign
competition is a quality product well
prepared for market, because we cannot
compete with foreign producers in price
and continue our present standards of
living.
LAND OF PLENTY
—Continued from page 24
—
The Flow of Goods and Services
The chief part of the tobacco grown
on domestic farms is retained in the
United States to supply the growing de-mands
of American consumers. In 1959
products of nearly 600 cigar factories,
27 cigarette factories and numerous other
establishments producing snuff, smoking
and chewing tobacco resulted in these
totals
:
488 billion cigarettes
about 7 billion cigars and cigarillos
nearly 73 million pounds of smoking
tobacco
over 67 million pounds of chewing
tobacco
around 34 million pounds of snuff.
Of these quantities more than 19 bil-lion
cigarettes were exported and other
manufactured goods were shipped a-broad.
Foreign buyers took some 470
million pounds of American-grown to-bacco—
chiefly flue-cured and burley
—
and paid around $350 million for this
desirable leaf.
Some 2,500 wholesalers channel to-bacco
goods to 1.5 million retail outlets
in the United States. Retail sales of
tobacco products in the United States
for calendar 1959 totaled $6.8 billion.
The fiscal value of this trade ranks third
among the federal sources of revenue.
The national government, state and mu-nicipal
treasuries get a healthy slice of
the retail sales total: $2.7 billion in 1959
The tobacco industry is heavily de
pendent upon suppliers and transporta-tion
services. Materials flow to tobacco
manufacturing centers from almost all
—See LAND, page 51
—
WINTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 27
ROYSTER
Bright Leaf Warehouse
Association Began In 1925
The Bright Belt Warehouse Associa-tion,
Inc. is a voluntary trade association
representing flue-cured tobacco ware-housemen
in the states of Florida; Geor-gia;
Mullins, South Carolina; North
Carolina and Virginia.
The Association has been operating
since 1945. Its governing body consists
of thirty members, six from each of
the flue-cured tobacco belts. Officials
this year are: A. J.
Brannen, Statesboro,
Georgia, President;
Harding Sugg,
Greenville, North
Carolina, Vice Presi-dent;
Guy E. Barnes,
Eocky Mount, North
Carolina, Treasurer;
Colonel William T.
J o y n e r, Raleigh,
North Carolina, Gen-eral
Counsel; and
Fred S. Royster of Henderson, North
Carolina, is the Association's Managing
Director.
The flue-cured area is divided into five
belts, namely, Georgia-Florida; South
Carolina-North Carolina Border; East-ern
North Carolina; Middle Belt, consist-ing
of markets in central North Caro-lina;
and the Old Belt, consisting of
markets in piedmont North Carolina and
all markets in the State of Virginia. The
markets operate in the various belts on
a staggered basis with the most south-ern
markets opening first and the other
belts at succeeding intervals of one to
two and one-half weeks.
The marketing of flue-cured tobacco is
a complicated procedure and the Bright
Belt Warehouse Association promulgates
rules and regulations or orderly opera-tion
of the markets. These rules include
hours per day which the markets may
operate, proper spacing of tobacco on
the warehouse floors and many other
matters for the protection of both seller
and buyer. Flue-cured markets operate
efficiently and in a very satisfactory
manner. The 1959 season was probably
the most satisfactory ever experienced.
In addition to regulations governing
the various markets, the Bright Belt
Warehouse Association has been instru-mental
in the maintenance and improve-ment
of the tobacco program. The As-sociation
cooperates very closely with
farm organizations and other trade as-sociations
in the interest of the overall
program. The most recent illustration
of this is the prominent part which the
Association played in obtaining federal
legislation for the continuance and im-provement
of the tobacco program.
Approximately one-third of flue-cured
tobacco produced in America is exported
—See WAREHOUSE, page 30—
E. B. Ficklen Tobacco Co. One Of Oldest Companies
Serving All Phases Of Tobacco Trade Continuously
E. B. Ficklen Tobacco Company, Inc.,
established in 1896, is one of the oldest
companies continuously serving all phas-es
of the tobacco trade.
This company buys tobacco on the
Georgia and Eastern Carolina Flue-
Cured belts, and their three Proctor &
Schwartz redrying machines, having a
daily capacity of
500,000 pounds, ex-pertly
redries and
packs the tobacco in
hogsheads and /or
cases as desired by
their customers.
The main plant is
in Greenville, North
Carolina with buy-ing
agencies in
Nashville, Georgia;
L. S. FICKLEN Madison, Florida;
Smithfield, North Carolina; Clinton,
North Carolina; and Farmville, North
Carolina. The com- ^^ pany also handles
b u r 1 e y tobaccos,
Maryland tobaccos,
and any and all
types needed by
their customers.
Over the past
sixty - four years
this company has
been shipping tobac-co
to all parts of the
world.
In addition to their own buying and
redrying facilities they have an interest
J. S. FICKLEN
in eight other tobacco companies and
are therefore in a position to more ade-quately
serve the tobacco trade.
With seven storages for redried tobac-co,
all located in Greenville, North Caro-lina,
the company has ample storage
facilities to care for tobaccos purchased
by their customers until the customer de-sires
it to be shipped.
During the tobacco season the company
employs between 500 and 600 people
carefully picking, blending, redrying,
and packing tobacco in an expert man-ner.
Founded by Mr. E. B. Ficklen, who
served as its head until his death in
1925, the company is well versed in all
branches of the tobacco industry whether
it be domestic or foreign. In 1925 Mr.
James S. Ficklen was elected as Presi-dent
and headed the company until his
death in September, 1955.
L. S. Ficklen, a son of the founder,
was elected President of the company in
October, 1955 and is being very ably as-sisted
by James S. Ficklen, Jr., who is
Vice President and Treasurer of the com-pany.
The other officers are well known
throughout the tobacco trade and are
A. C. Ruffin, J. T. Cheatham, Jr., and
C. C. Skinner, Vice Presidents; O. L.
Alexander, Secretary; and E. O. Parkin-son,
Jr., Assistant Secretary.
L. S. Ficklen and James S. Ficklen, Jr.
both are well known throughout the to-bacco
industry through their activities
in organizations promoting the use of
—See FICKLEN, page 33—
E. B, Fitklin Tobacco Plant,, Greenville
PAGE 28 THE E. S. C. QUARTERLY WINTER-SPRING, 1960
Plant Manufactured First American Cigarette Paper On September 2, 1939
Now Diversified!
With two decades of continuous prog-ress
in the background, the Pisgah Forest
operation of Olin Mathieson Chemical
Corporation moves ahead in its twenty-first
year as a diversified industry of
stature.
From the manufacture of cigarette
paper, the original and ever-important
product, the operation has expanded to
manufacture of such products as cello-phane,
polyethylene, cigarette niters,
end papers and home permanent waves,
woven belts for machinery, one-time car-bon
papers, cigarette tipping papers and
plug wraps, and the new and improved
qualities of lightweight printing papers.
It was little more than two decades
ago when the late Harry H. Straus,
founder of Ecusta Paper Corporation,
saw his envisioned manufacturing plant
become a reality in Transylvania County.
On September 2, 1939, the first paper
machine rolled off the first paper to be
manufactured here for the American
cigarette market.
The plant had four paper machines
in operation just as the outbreak of
World War II foretold the end of im-porting
cigarette papers from Europe.
Addition of four more machines in the
early years of the war put the plant in
position to supply a substantial part of
the paper requirements of a tobacco in-dustry
faced with demands for more
production volume than ever.
There were approximately 350 persons
engaged here in the manufacture of top
quality cigarette paper 21 years ago.
From that small beginning the company
has seen many changes, each constitut-ing
growth. When the four original
paper machines were in production and
the plant was nearing full operation,
the employment had increased to 950
persons and the annual payroll to $1,-
200,000. It increased proportionately
when, in 1941, the four additional
machines were added.
Today, there are approximately 2,500
employees in the two divisions at Pisgah
Forest. The payroll is 10 times that of
1940—$12,000,000 a year. As employ-ment
increased about 163 per cent in
the 20-year period, the payroll increased
900 percent.
Specialty papers were developed for
the U. S. Government during the war.
The company, expanding from this ex-perience,
entered the Bible and printing
paper fields after the war.
A ninth paper machine was added in
1947 to handle increases in orders for the
lightweight papers.
From a corporate standpoint, one
chapter ended and another began when
Mr. Straus sold his interests in Ecusta
to Olin Industries in 1949. The plant
became known as a subsidiary of Olin
Industries.
Association with Olin brought forth
a significant development—construction
of facilities to manufacture cellophane
and, on June 11, 1951, the casting of the
first cellophane at Pisgah Forest. The
Film Division, with nine casting ma-chines
in operation, utilized many of the
Paper Division's existing facilities.
The Film Division reached another
milestone with the start of production
of polyethylene in December, 1954.
The same year, the corporate status
changed again as Olin Industries merged
with Mathieson Chemical Corporation,
forming the Olin Mathieson Chemical
Corporation.
In 1958, the Pisgah Forest operations
became part of the Packaging Division,
one of seven major divisions of Olin
Mathieson.
Growing markets due to higher con-sumption
and population increases led
in the mid-1950's to a market survey and,
ultimately, the recommendation to build
a new paper machine. A realty as of
August 27, 1958, the No. 10 paper ma-chine,
named The Cherokee Arrow, and
its stock preparation equipment are im-portant
units in the company's facilities
to produce lightweight papers and car-bonizing
tissues.
Recent announcement of a special
lightweight paper produced by Ecusta
exemplifies the growth of product varie-ties.
This paper, sold under the name
Ecusta Waylite, is expected to play a
significant role in the printing industry,
and is further expansion of the Waylite
line designed for today's needs.
The establishment of the Paper Divis-ion
at Pisgah Forest in 1939 provided
the first large scale production of cig-arette
paper in this country. Previously
American cigarette manufacturers were
dependent on imports of cigarette paper
from foreign sources. The Film Division
plant was built on the same location be-cause
of the excellent water supply and
other existing facilities of the paper
plant.
Both the paper mill and the cellophane
plant are very modern, and are model
operations in many respects.
Pure water is of utmost importance in
cigarette paper and cellophane manu-facturing
processes. The water treating
plant has a capacity of 25 million gal-lons—
daily enough to supply a city of
150,000 inhabitants.
To make these ope

^V M ^» « — Raleigh
The E. S. C. Quarterly
VOLUME 18, NO. 1-2 WINTER-SPRING, 1960
Employment Security Commission of North Carolina
Cover Legend Page Two Index On Page Eleven
PAGE 2 THEE. S.C. QUARTERLY WINTER-SPRING, 1960
The E. S. C. Quarterly
(Formerly The U.C.C. Quarterly)
Vol. 18, No. 1-2 Winter-Spring, 1960
Issued at Raleigh, N. C. by the
EMPLOYMENT SECURITY COMMISSION OF
NORTH CAROLINA
Commissioners: Mrs. Quentin Gregory, Halifax; Dr. Maurice
Van Hecke, Chapel Hill; R. Dave Hall, Belmont; W. Benton
Pipkin, Reidsville; Bruce E. Davis, Charlotte; Crayon C.
Efird, Albemarle.
State Advisory Council: Public representatives: James A.
Bridger, Bladenboro, Chairman; Sherwood Roberson, Rob-ersonville;
W. B. Horton, Yanceyville; Mrs. R. C. Lewel-lyn,
Dobson, and Dr. J. W. Seabrook, Fayetteville; Em-ployer
representatives: A. L. Tait, Lincolnton and G.
Maurice Hill, Drexel; Employee representatives: Melvin
Ward, Spencer, AFL and H. D. Lisk, Charlotte, CIO.
HENRY E. KENDALL Chairman
R. FULLER MARTIN Director
Unemployment Insurance Division
JOSEPH W. BEACH Director
North Carolina State Employment Service Division
TED DAVIS Editor
Public Information Officer, Member PRSA
MARTHA JACKSON Associate Editor
Sent free upon request to responsible individuals, agencies,
organizations and libraries. Address: E.S.C. Informational
Service, P. O. Box 589, Raleigh, N. C.
INDEX APPEARS ON PAGE 11
ABOUT THE COVER PICTURES
Top, left, shows workers pulling tobacco plants from tobacco bed prior to
transplanting them in the fields. These may be transplanted by hand or
machines.
Top, right,, in this hand are enough tobacco seed to furnish plants for
four acres of tobacco.
Center, left, worker holds up a perfect leaf of tobacco. This green tobacco
is tied on sticks prior to being put in the barn for curing.
Center, right, these trucks are moving the tobacco hogsheads (about 900
pounds of cured tobacco in each hogshead) to cigarette factories after
redrying process.
Lower, left, here is the interior of an auction warehouse and shows the
shallow baskets of tobacco laid out in long rows marked with the owner's
name and the certified weight of the tobacco in each basket.
Lower, right, auctioneer, with upraised hand, chants the prices bid for
tobacco. Buyers for tobacco companies move along with him examining
the tobacco and bidding on each individual basket.
SUMMER-FALL EDITION
TO FEATURE FURNITURE INDUSTRY
North Carolina's rank in the manufacture of furniture
is at or near the top in the entire nation. The position
would probably depend upon the classifications of furniture.
The span of the furniture in this State runs from "com-petitive"
pieces to the finest "name" suites to be had
anywhere in the world. Tarheel manufacturers of furniture
number in the hundreds and a story about each will appear
in the next edition of THE QUARTERLY.
Requests for copies of the "Furniture Edition" are now
being accepted. The issue will probably be in great demand,
so our supply of "extra copies" will be parceled out on a
first-come-first-served basis. Should you be a subscriber,
there is no need for you to request a copy as you will
receive yours at the address to which your copy usually
goes.
CHAIRMAN'S COMMENTS
Henry E. Kendall, Chairman
Employment Security Commission
Tobacco is the nation's oldest industry, with more than
three million people engaged in producing, manufacturing)
and distributing it. Last year some 65 million Americans!
bought 436 billion cigarettes, 6.4 billion cigars, 74 millionl
pounds of smoking tobacco, and 35 million pounds of snuff.j
Featuring the tobacco industry in this edition of thtl
QUARTERLY brings up-to-date the 1951 edition whicr|
spotlighted the weed. North Carolina raises two-thirds of all
the flue-cured tobacco grown in the world. More tobacccj
products are made in North Carolina than in all the othei;
states combined.
With approximately the same number of acres of tobaccc
being grown each year, only the yield per acre affects the
State's position in its percentage compared with other sec
tions of the world.
There are 32,185 people employed in the tobacco industrj
in North Carolina who are covered by unemployment insur
ance and come under the Employment Security Law.
Federal taxes on tobacco and tobacco products in a single
year amount to more than $1.7 billions. Additional taxes col
lected by State and municipal treasuries from tobacco sol<
at retail total more than $700 millions.
Ever since tobacco was first discovered to be a "mone:
crop" it has gone a long way toward underwriting the cos
of the government. The credit of the Continental Congres
was supported by a loan on tobacco leaf. Benjamin Franklh
helped obtain the loan of some 2 million livres from th
French tobacco monopoly which was to be repaid by 5 millioi
pounds of leaf tobacco.
For many years the economy of North Carolina was de
pendent upon the tobacco crop and textiles. A bad crop coul
be felt by every citizen, and when combined with layoffs ii
the textile industry could be devastating.
In recent years the State has begun diversifying its indus
try. Commercial vegetable crops have come to the forefron
in farming, and today account for an amazing number o
dollars for growers. Poultry raising has become popular an
North Carolina is near the top in the production of broilers
A recent survey shows that in the past nine years thi
tobacco industry has put more than $314 millions in capita
outlays into new manufacturing, processing and researc
facilities. This was done to keep pace with consumer require
ments and to provide better products.
The industry is budgeting about $80 millions during 196C
61 for further expansion and improvement.
In the use of tobacco, countries having the highest pe
capita use in pounds are: U. S., 8.6; Canada, 7.2; Netherland
6.0; Belgium, 5.8; Australia, 5.5; Switzerland, 5.3; Denmarl
5.2; Ireland, 5.1; United Kingdom, 4.9; New Zealand, 4
West Germany, 3.9; and Norway, 3.0.
Also in this issue you'll find stories of other industries i
the State, our Business Machines Unit, an East Coast Far
Pattern meeting, and other notes on activities of yo
Employment Security Commission.
VINTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 3
I J. Reynolds, Largest In Industry . . . Still Continues To Grow And Expand
R. J. Reynolds Tobacco Company,
Vinston-Salem, already the largest in
he industry in sales, continues to
xpand.
In the last three years alone, Reynolds'
capital expenditures
have totaled nearly
$75,000,000 to ex-pand
its facilities
for the manufacture
of cigarettes and
the processing and
storing of leaf to-ga
j ounds of tobacco, at
3rook Cove, Stokes
Uounty. This facility carter
s now in operation.
• A similar stemming and redrying
)lant, with 24 storage warehouses hav-ng
capacity for 130,000,000 pounds of
tobacco, completed at Lexington, Ken-tucky.
• A new aluminum foil rolling and
converting plant, operating as Archer
Aluminum, a division of R. J. Reynolds
Tobacco Company. (An addition to this
plant is now being built, in which Archer
will be able to produce its own aluminum
sheet from ingots.)
• A new tobacco processing plant in
downtown Winston-Salem.
• A major expansion of the company's
research facilities, adding 60,000 square
feet of floor area.
Brand Leadership
In the highly competitive cigarette
field, the Reynolds Tobacco Company has
the triple distinction of producing:
America's leading brand—CAMEL; the
nation's most popular filter brand
—
WINSTON (introduced in 1954) ; and the
eynolds Tobacco Company's 22-story office build-ig
in downtown Winston-Salem is headquarters
i>r the company's world-wide business.
R. J. Reynold's products are shown above: Top,, chewing tobaccos, bag tobaccos, cigarettes, and
pipe tobaccos.
PAGE 4 THE E. S. C. QUARTERLY WINTER-SPRING, 1 96C
country's favorite menthol-flavored brand
—SALEM (introduced in 1956).
Reynolds makes two other types of
tobacco products and also has the dis-tinction
of producing America's leading
brand in each of those categories: smok-ing
tobaccos—PRINCE ALBERT; chew-ing
tobaccos—DAYS WORK.
Some of the company's other principal
brands are: CAVALIER Cigarettes;
GEORGE WASHINGTON, CARTER
HALL, STUD, and OUR ADVERTISER
Smoking Tobaccos; and APPLE,
BROWN'S MULE, and REYNOLDS'
NATURAL LEAF Chewing Tobaccos.
Reynolds' Archer Aluminum Division
rolls, laminates, and otherwise processes
aluminum foil for use by the company
and for sale to others. It also produces
some additional packaging materials
used by the company. Its output of other
items, including foil for use by florists,
continues to grow.
R.
Company Statistics
J. Reynolds Tobacco Company has
more than 14,000 regular, full-time em-ployees.
In addition, it provides seasonal
employment for more than 3,000 other
employees.
The company's full-time employees
have an average length of service of
better than 14 years. Over 40% of them
have been with the company for 15 years
or longer; 19.1% have service records of
30 years or more.
In 1959 Reynolds had net sales of
$1,286,855,943 net earnings of $90,357,-
655. At the end of 1959 the company's
assets totaled $853,351,560.
Samples of florist foils produced by Archer Alum-inum,
a division of R. J. Reynolds Tobacco Com-pany.
Bowman Gray is chairman of the
board. F. G. (Bill) Carter, former sales
manager, is president. Haddon S. Kirk
is chairman of the executive committee.
Executive vice presidents are A. H. Gal-loway,
former treasurer, and S. B. Hanes,
Jr., former superintendent of leaf buying.
Historical Beginnings
The business of R. J. Reynolds Tobac-co
Company was founded in the sprhn
of 1875 by Richard Joshua Reynolds, m
had been in a tobacco manufacturinf
partnership with his father, in Virginia
but decided to venture out on his ownil
Putting his decision into action, hi
traveled by horseback to Winston, Nort]
Carolina, and bought a piece of land oi
Chestnut Street. The factory he built o]
that lot was a red frame structure whicl
Reynold's new $30,000,000 cigarette factory at Whitaker Park, Winston-Salem, begins to take shop
It will be completed in 1961, expanding the company's cigarette manufacturing capacity by 25ld owner. He had saved up $7,500 to
mild the factory and launch his venture,
rat he needed much of that money to
ray the choice leaf he insisted on for his
iroducts. Leaf-tobacco auction markets
iperated on a "pay as you buy" basis,
ust as today.
Like the factory, E. J. Reynolds' work-ng
force was at first small; he had only
wo regular assistants and scarcely a
lozen seasonal helpers. During the early
rears of the business, chewing tobaccos
vere the only products made. At the
tart, a one-horse dray sufficed to cart
he products to the depot for shipment.
3ecause mechanical means of redrying
he leaf had not been invented, manu-acturing
was necessarily limited to
tbout six months a year.
Quality Pays
Soon the high quality of the Reynolds
>roducts was winning repeat orders, and
he growing demand made additions to
he plant necessary. The thriving busi-less
also created jobs for more em-doyees.
To provide for the expansions,
he youthful owner plowed most of his
larnings back into the business.
Special honors for the quality of its
troducts came to the young company in
895: Reynolds received the highest
iward on chewing tobaccos at the big
]otton States & International Exposition
n Atlanta. That was also the year the
ompany began to produce smoking
obacco.
Paced by the popularity of its chewing
md smoking brands, the Reynolds To-
>acco Company by the close of the cen-ury
had built up a sizable industrial
ilant. It consisted of seven buildings,
imploying hundreds of people. Inventive
levelopments had been such that the
actories were able by then to operate
he year around.
In its present form R. J. Reynolds
Pobacco Company was incorporated in
"few Jersey. It was chartered there in
899, with initial capital of $2,100,000
md 13 stockholders. R. J. Reynolds was
he first president and continued at the
telm until his death, in 1918.
Camels Introduced
The company entered the cigarette
ield in 1913, introducing the first
nodern-type blended cigarette: CAMEL.
That happened to be the same year
Vinston and Salem officially became one
ity.) While a machine had been invented
s early as 1872 to speed the making
f cigarettes, 40 years later cigarettes
were still a quite minor part of the
tobacco manufacturing industry com-pared
with smoking and chewing to-baccos.
With the coming of CAMELS,
the tobacco habits of the nation were
changed in just a few years, and the
"cigarette era" really began. (To bring
the picture up to date, 1957 was the first
year in which over 400 billion cigarettes
were sold in the United States. By 1959,
sales had increased to about 455 billion.
CAMEL has led all other brands for
eleven straight years, according to Harry
M. Wootten, well-known consultant to
the industry.)
All the products of the company are
made in just one locality, Winston-Salem.
Such centralization is rather unique in
the tobacco industry. However, Reynolds
finds this of value in maintaining the
Reynolds welcomes thousands of visitors each year in this room, starting point for one of its plant tours.
A Reynolds guide, escorting plant visitors on a personalized tour, explains a step in the cigarette
packing procedure.
PAGE 6 THE E. S. C. QUARTERLY WINTER-SPRING, 196CI
This cigarette making machine is capable of producing over 1,200 perfectly shaped CAMEL cigarettes
a minute. Tobacco is brought by overhead conveyors that automatically fill the machines. The
inspector checks the cigarettes closely for uniform siie and weight.
high standard of quality for which its
products are famous. The company's
factories form the largest cigarette and
tobacco manufacturing plant in any city
in the world.
Research Important
Research has long been an important
factor in the progress of Reynolds.
Special experiments, begun in 1904, led
to the company's perfecting in 1907 its
process for a new product, PRINCE
ALBERT Smoking Tobacco. Even more
extensive research was next undertaken
in the cigarette field. As a result of this
work, the first modern-type blended cig-arette,
CAMEL, was created. Similar
painstaking efforts were later devoted
to achieving the distinctive character-istics
of WINSTON, SALEM, and CAV-ALIER
Cigarettes. The formula for
CARTER HALL Smoking Tobacco was
also achieved through exacting experi-mentations.
These are but a few of the
many contributions that research has
made to further the progress of the
Reynolds Tobacco Company through the
years.
From a one-room origin, the research
structure in the company has been ex-panded
time and again. Reynolds' pres-ent
research center consists of two large
modern buildings (one completed in
1953, the other in 1957). These buildings
are connected, and the combined unit is
functionally designed for many diverse
activities, including use of the latest
radioisotope techniques. The facilities
for tobacco research are the most exten-sive
in the industry.
The Reynolds research staff includes
many scientific specialists and techni-cians
in a variety of allied fields. It is
in the tradition of Reynolds that the
staff is continually exploring possibilities
for improving the company's products,
devising better and more efficient
processing methods, and developing new
products. Scientists of the company havf
always worked closely with federal ancj
state agricultural agencies, and througl
them with tobacco growers, on tech-jl
niques for bettering the quality of thf I
leaf.
85th Anniversary Year
A short article can give only a capsule-size
account of a business which is nov|
nearing its 85th anniversary. The hand-ful
of employees with whom Mri
Reynolds began his undertaking in 1879
has grown into the force of over 14,00(!
regular employees, already mentioned
Production for the whole original yea:|
would amount to only a fraction of j
present single day's output. Where onc<
they were known in only a few localities
Reynolds' products today are enjoyed al
over America and around the world. Th|
"little red factory" which housed thi
business in the beginning has been multi
plied into over 200 large factory unit
and leaf storage warehouses. In contras
to the $7,500 the founder had to launcl
the entire business venture, the averagj
investment behind each regular em
ployee's job amounts now to ove
$56,000.
Regular employees have the benefit o
the company's group life, accident am
sickness insurance plan; retiremen
plan; comprehensive medical plan o
hospital and surgical service plan; jur;
service plan; vacation plan; paid holi
days; suggestion plan; educational plan
family group life insurance plan; an
profit sharing plan. Among the service
the company maintains for its employee
in Winston-Salem are an extensive medi
After cigarettes are packaged, they pass before
packages are then put into cartons automatically.
an inspector who checks for packaging flaws. Tl
WINTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 7
Expansion: The plant of Archer Aluminum, Reynolds' foil division. Steel framework and part of roof
of new addition can be seen.
cal department, cafeterias, parking lots,
and the confidential assistance of a pas-tor-
counselor. (A small private chapel
adjoins the office of the pastor-counselor
and he uses it in his work with individual
employees who may come to him with
personal problems. It is also available
to persons seeking a haven for private
meditation during the working day.)
On Average Workday
On the products made on the average
workday, the company pays the U. S.
Treasury over $2 million in excise taxes.
Reynolds' shipments in and out of Win-ston-
Salem on the average workday re-quire
upward of a mile of railway
freight cars and highway motor carriers
combined. Considerably more than one
million business concerns enter into
Reynolds' daily operations—among them,
suppliers of the great variety of manu-factured
items used in the plants and
offices; numerous transport lines; thou-sands
of tobacco-product wholesalers,
and a multitude of retail outlets.
More than 81,000 stockholders share
in owning R. J. Reynolds Tobacco Com-pany.
They include people in each of the
50 states and in almost every walk of
life; educational, charitable, and medical
institutions; churches; insurance com-panies;
and pension and trust funds.
Plant Tours
The company is happy to provide per-sonalized
tours in its plant for the public.
This program was begun in 1918 and
has been expanded through the years.
These tours are now provided during all
the working days and nights in the plant.
Thousands of people a month—visitors
from the various states and many foreign
countries—come for the Reynolds tours
to see America's most famous cigarettes
being made.
* * *
The scope of R. J. Reynolds Tobacco
Company today would probably surprise
even that farseeing young man whose
initiative, so many years ago, gave it its
start. The progress the company has
made under the American system of free
and competitive enterprise reflects the
spirit, skill, and teamwork of a great
many people working together over a
long span of years.
COMPLETE
INDEX
ON
PAGE 11
Reynolds' Tobacco Research Center
Salem contains over 100,000 square
area. It provides the finest facilities
in the tobacco industry.
in Winston-feet
of floor
for research
-
••
.:-..
*
'
."'V, ; ^ .;-,.,
....... :- ,::;.j •-..-
-::>S :::0 ;>? :
:
:
:^ . : y^y AS ' yy'^y :
: A yj ^ o ^yfy y ' ': '•-.., .
'
:,...-..y'.r ^ -
, -.,../- .-•••
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SSI?!?.
R. J. Reynolds Tobacco Company's facilities in downtown Winston-Salem. In the right foreground is
seen the 22-story Reynolds Building, the company's headquarters.
PAGE 8 THE E. S. C. QUARTERLY WINTER-SPRING, 1960
NORTH CAROLINA IS THE HOME OF LIGGETT & MEYERS TOBACCO COMPANY
Liggett & Myers Tobacco Company
traces its beginnings to the early 1800's.
but the Company name of Liggett &
Myers originated in 1873 when John
Edmund Liggett and George S. Myers
formed a partnership. In 1879, the part-nership
was dissolved, and the firm was
incorporated as Liggett & Myers Tobac-co
Company.
The Company prospered and by 1885
was considered the largest plug tobacco
manufacturer in the world, with STAR
as its leading brand of plug tobacco. By
1899, Liggett & Myers Tobacco Company
had become a part of the American To-bacco
Company.
In 1911, the dissolution of the Ameri-can
Tobacco Company, under the pro-visions
of the Sherman Anti-Trust Act,
once more established Liggett & Myers
Tobacco Company as an independent
manufacturer. On December 1, 1911 it
was incorporated under the laws of the
State of New Jersey.
Liggett & Myers acquired the Durham
factory which had been built by W. Duke
Sons and Company in 1884 and had be-come
one of the first units of American
Tobacco. The Company inherited Fatima,
the leading brand of blended cigarettes,
Piedmont and American Beauty, also
among the most popular cigarette brands
at the time, and Home Run, King Bee
and other brands.
In 1912, Liggett & Myers became the
first of the successor companies to ex-periment
with the blended cigarette, as
we know it today, when it introduced
Chesterfield. Chesterfield is a blend of
flue-cured, burley, Turkish and Maryland
tobaccos. World War I enhanced the de-mand
for the blended cigarette, and by
1920, Chesterfield had become the lead-ing
Liggett & Myers cigarette brand. In
1952, Chesterfield became the first cigar-ette
to be marketed in two sizes, both
regular and king-size.
The first President of the reorganized
Liggett & Myers was Caleb C. Dula, a
native of Lenoir, North Carolina, who
had been James Buchanan Duke's able
associate at American Tobacco. Mr. Dula
became Chairman of the Board in 1928
and served in that capacity until his
death in 1930.
Clinton White Toms, a native of Hert-ford,
North Carolina, became the second
President of Liggett & Myers when he
succeeded Mr. Dula in 1928. Mr. Toms
had been Superintendent of Schools in
Durham before he entered the tobacco
business in 1897. William Washington
Flowers, who succeeded Mr. Toms as
Superintendent of Schools in Durham,
left that post to join Liggett & Myers
in 1911. He later became Vice President
and finally served as Chairman of the
Board from 1936 to 1941. A third Super-intendent
of Durham Schools, William
Donald Carmichael, also joined Liggett
& Myers and later became advertising
Vice President before he retired in 1942.
Mr. Toms served as President until his
Front- and rear construction views of the extensive addition being made to L&M Research Laboratories
in Durham, North Carolina. Addition will double size of modern laboratories originally built some
ten years ago.
More than three quarters of a million people have taken one of the most popular of all industric
tours through the modern cigarette factories of Liggett & Myers Tobacco Co. The Durham "home
of Chesterfields, L&M and Oasis pictured here is conveniently located on Main Street in downtow
Durham. Visitors are welcome to take fascinating, hostess-conducted tours between 8 and 11:15 niers including wholesalers and large
etail outlets such as drug and grocery
dains. And, there are more than 1,000
iggett & Myers sales personnel in the
eld servicing these complex and all-nportant
channels of distribution.
Liggett & Myers is a worldwide busi-ess.
The Company's brands are sold in
lost markets around the world, over 105
)reign countries. These export sales
lake an important contribution to the
ver-all business of the Company.
Because it is in one of the most com-etitive
of all industries, Liggett &
[yers is today one of the largest users
f national advertising in this country.
Fetwork television, including special
Miles of modern leaf storages located on Highway 70 by-pass, Durham, are necessary to properly
age over many months millions of dollars worth of the best tobaccos used to make Liggett & Meyers
brands of cigarettes.
sports events, is the largest single me-dium
used in the Company's advertising
program, but wide use is also made of
radio, magazines, newspapers, outdoor
signs, display advertising and others.
It represents an annual expenditure of
millions of dollars paid for billions of
advertising impressions. This investment
in demand—demand for the Liggett &
Myers quality products—is an important
ingredient in the cigarette business
today.
> R-AMA PLANNED FOR
NOVEMBER 10 AT RALEIGH YMCA
A concentrated, one-day Public Rela-ons
Seminar is planned by the Caro-nas
Chapter of the Public Relations
ociety of America and the Raleigh
ublic Relations Society. The meeting
ill be held Thursday, November 10,
960 in the new Raleigh YMCA on
[illsboro Street.
Co-sponsoring the meeting with the
vo Societies are: WRAL-TV, Raleigh;
/TVD, Durham; WDNC Radio, Dur-km;
WPTF Radio, Raleigh; The Dur-am
Herald, Durham; The Durham
un, Durham; The Raleigh Times, Ra-igh;
The Raleigh News and Observer,
aleigh; the Associated Press and the
nited Press International.
Registration will begin at 8 a.m. and
orkshops will begin promptly at 9:15.
wo major speakers will be featured at
ie luncheon and banquet. Cost of the
itire day, including luncheon and ban-iet
is to be $6 per person.
Workshops will be
:
How To Work With Television;
How To Work With Radio;
How To Work With Newspapers; and
How To Set Up and Operate Any
ze Public Relations Department.
The staffs of the various news media
will constitute the panels of the news
workshops. They will feature men who
know "why your last article or picture
did not hit the public eye and ear." Hor-rible
examples of un-newsworthy pic-tures,
articles and scripts will be shown
the registrants with explanations of
how publication could have been assured.
Four of the nation's top PR executives
are being secured for the PR Panel.
They represent the largest, the medium-sized,
and the most successful small PR
agencies and will have approximately
80 years of PR knowhow and experience
backing them up in their remarks.
Registrants will be divided into four
groups as they register and will attend
all workshops which will last an hour
each. Workshops will begin at 9:15 a.m.;
10:45 a.m.; 2:30 p.m.; and 4:00 p.m.
The luncheon will start at 12:30 and
the banquet at 6:30.
The one-day affair was planned when
it was noted that most PR conferences
start about noon one day and end at
noon the next. By crowding the entire
event into one day, the group will be
made to really think, and will not have
INDEX
American As of 1960 15
Assistant VER Wadsworth Receives Award !!.51
Austin Carolina One Hour of All Markets 30
Bright Leaf Association 27
Burley Growing Is Profitable 32
Business Machines Covers Million Items .34
Carolina Clipping Service Stays Busy 44
Chairman's Comments 2
Charlotte Opens New Office ...56
Cigarette Paper Plant Began 1939 .28
East Coast Farm Placement Meet Is Success 52
Eastern Weed Firms Organize 47
Fayetteville Opens New Office Officially ............. .51
Ficklen One of Oldest '
'
27
Former Employees, Where Now ?
'.'.'.'.'.'.'..' 40
Goodwin, BES Director Arrives .52
Hill Consultants Offer Manv Services ....47
Improving Marketing Practices .26
Lea Tobacco Pioneers 31
Lewis of Washington Visits State 51
Liggett & Myers, N. C. Is Home ' g
Lorillard Celebrates Bicentennial '
' 12
Miller, Domestic and Import Firm 31
Moen Retires
[
50
Monk Tobacco Calls Farmville "Home" ............. .38
Ports of N. C. Important to Industry '41
PR-AMA Planned ..'. jj
Redryers and Packers Listings '40
Registrants At 1960 Pattern Farm Meet ......'.." 53
Research Program of Tobacco Industry 21
Reynolds, Largest in Industry 3
Sanford Tobacco One of Most Modern 37
Southeastern In Heart of Belt .....23
Taylor Brothers' Picturesque Brands ...... . . . . . . . . \ 29
Tobacco Growers Information Committee .'. 48
Tobacco Priming 54
Tobacco's Land of Plenty ..20
Tobacco Tying [\ 55
VER Godwin Celebrates 49
Webb & Company Established 1895 .25
Wilson Tobacco Co. Began in 1917 A0
time to lose interest in the events.
Registrations will be accepted on a
first-come-first-serve basis. They may be
mailed to: Registrar, P R-AMA, Box
—See PR-AMA, page 19—
PAGE 12 THE E. S. C. QUARTERLY WINTER-SPRING, 196C
P. LORILLARD COMPANY-BICENTENNIAL
The candles on its 200th birthday cake
will be lighted by the P. Lorillard Co.
within the next few days to signal the
first corporate bicentennial celebration
in the tobacco industry. Twelve months
hence when it snuffs them out by closing
its books on 1960, it expects to have
made an auspicious start into its third
century in business.
Lorillard officials view their company
as an intertwining of tradition and
progress; the former always being made
and the latter forever representing the
challenge. In a year-end note to stock-holders,
Lewis Gruber, chairman of the
board and chief executive officer, said:
"As we look toward our 200th anni-versary,
we are proud indeed to carry
America's earliest tobacco name, but we
are even more eager to carry on with
America's newest tobacco ideas as em-bodied
by our major cigarette brands.
Throughout 1960 and the years ahead,
you may be sure that Lorillard will
strive to be first with the finest tobacco
products, through Lorillard's research."
Recent History
The recent history of this company
which pre-dates the American Revolu-tion
has been so exciting that it is not
only familiar to everyone in the tobacco
industry, but is also well known to the
nation's entire business community and
to the investing public at large.
Though confident in 1954 that it was
well fortified to withstand the anti-tobacco
crusade by virtue of its Kent
Micronite filter cigarette—the first of
the high-filtration brands—the company
lost considerable ground to manufactur-ers
of popular-price filters. Lorillard
sales rose 12.8% in 1953 when the indus-try
was off 2% from the previous year, but
the following year its volume dropped a
sharp 14.9% when the industry declined
only 4.6%.
It was not until August 1956 that the
company's fortunes began to take a turn
for the better. Lewis Gruber was elected
president by the board of directors and
he began to reorganize and strengthen
his management team. Harold F. Temple
and Manuel Yellen, who had come up
through the ranks in the company, were
made vice presidents. Mr. Temple was
made director of sales, and, later, electee
President. Mr. Yellen was charged witr
directing advertising and marketing, anc
subsequently, was named Sales Vicdl
President.
Dr. Harris B. Parmele, the company's!
vice president and director of research I
was given more authority and instruc-
1
tions to step up and revitalize the com||
pany's research department. George 0;
Davies, treasurer, was promoted to vic<
president and chief financial officer
George A. Hoffman, now vice president
Dr. H. B. Parmele
Research
George O. Davies
Finance
George A. Hoffman
Manufacturing
Shape of Lorillard Progress is embodied in its prize-winning single-level plant at Greensboro, N. C, which covers 13 acres of an 80-acre plot. When
was opened in 1956 it was named one of the 10 "Top Plants of 1956" by Factory Magazine. The plant is a massive and perfectly timed symbol
great changes that have taken place in cigarette manufacture—the rise of the filter cigarette, the new brands, the variation in packaging, etc. The fl
of tobacco is virtually automatic in the processing stages,, the actual cigarette manufacture, packing and shipping. An automatic climate control systi
regulates temperature and humidity according to the needs of the various plant departments. Plant and equipment have been designed "as a unit" acco
ing to specifications of P. Lorillard Company, with special provision for expansion and flexibility so that new developments caused by the shifts
smokers' tastes can be swiftly integrated into the plant's normal operations. Plant has most advanced equipment for scientific research in eight laboratori
WINTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 13
foment before things begin to happen to tobacco
i "live storage" room of P. Lorillard's Greensboro,
I. C, plant. This room is a temporary halt where
he hogsheads will be held until the tobacco is
eeded in the processing. Previous resting places
or the hogsheads had been in terms of storaqe
s storage, but the tobacco's stay here can be
erminated at a moment's notice. The giant hogs-eads
contain aged and cured tobacco classified
xcording to type and grade. They will be opened
it both ends preparatory to going through the
iext stage, the moistening.
'ransformation of tobacco starts in tobacco
loistening unit, which resembles three elevators
nd simultaneously holds four opened hogsheads
f tobacco in each of its three compartments,
obacco coming from the "live storage" room of
. Lorillard Company's Greensboro, N. C, plant
ere enters the first stage of the processing which
hanges it from a dried plant into a fluent
leasure-giver. This process ensures that aged and
ured tobacco has perfect moisture content for
igarette making. A vacuum is created in each of
he compartments, causing the injected moisture
i penetrate throughout the tobacco. Each eleva-n-
like compartment finishes its operation in 16
linutes and the hogsheads are then automatically
onveyed to the next stage.
lixing to taste occurs in this conveyor after the
tree types of tobacco—Virginia, Burley and
urkish—are broken out of the hogsheads and
'ought together on this giant conveyor in the
Lorillard Company's Greensboro, N. C, plant,
obacco
_ keeps moving on conveyor while it is
sing mixed, thus losing no time on its way to
te cigarette-making room.
Blended mainstream of tobacco takes form in
P. Lorillard's ultra-modern plant in Greensboro,
N. C. The tributaries are two separate conveyors
(coming from upper left and lower right on photo-graph)
of identical blended tobacco, which feed
into the large centrally located conveyor con-nected
with cigarette-making room. Tobacco
comes from independent dryer and cooler systems
designed to give it perfect moisture and tempera-ture
to ensure fresh tobacco taste and aroma.
This perfection in bulk form is now ready to be
formed into the neatly contained pleasure of a
cigarette.
was made director of manufacturing.
And Herbert A. Kent, former Lorillard
president and board chairman, was called
out of retirement to serve as a director
and consultant.
Later, when Lorillard's international
operations assumed new importance,
Morgan J. Cramer, head of the com-pany's
export operations, was elected a
director.
Reduced Price
One month after his election to the
presidency, Mr. Gruber reduced the price
of Kents to the popular level and within
ten months sales of the brand tripled.
When in the summer of 1957 a leading
national magazine reported this brand
to give smokers the lowest amounts of
tars and nicotine, consumers virtually
stampeded retail counters to buy Kent.
Even today, some are inclined to at-tribute
Lorillard's success to luck. The
tobacco company's officers do not deny
Distinctive packages of Kents stream out of the
cigarette-packing machines in vast making and
packing room of P. Lorillard's plant in Greensboro,
N. C. The cigarettes have been transferred to the
packing machines by "suitcase" containers and
now, after the packing stage, are en route to be
put into cartons. Heart of plant is this room,
457 feet long and 310 feet wide—large enough
to hold three side-by-side football fields. With
its Micronite filter, Kent caused a revolution in
the cigarette industry, leading an amazingly fast
development that saw filter tip production rise
from insignificance to the capture of half of the
cigarette market in a half-dozen years.
Cartons of Old Golds are sealed as they move
down conveyor en route to the shipping room in
P. Lorillard Company's Greensboro, N. C, plant.
The Old Gold "family" includes the Old Gold
Straight, regular and long size, and the Spin
Filter. The oldest brand among Lorillard's blended
cigarettes. Old Gold has become "plural" to meet
various tastes of contemporary smokers.
Creation of the cigarette takes place in this vast
making and packing room of P. Lorillard Com-pany's
plant in Greensboro, N. C. The overhead
feeder-conveyors carry the Lorillard blends here,
where they are fed into the cigarette-making
machines. As cigarettes shoot out of the ma-chines,
girls place them in "suitcase" containers
on automatic conveyor which takes them to pack-inq
department. This is the heart of the Greens-boro
plant—where cigarettes are created at the
explosive rate of 1,200 or more per minute, per
machine.
End of production line where cases containing 60
cartons of Old Gold, Newport and Kent cigarettes
stand ready for shipment in P. Lorillard Com-pany's
Greensboro, N. C, plant shipping room.
Stacks of cases will be transported on their
pallets automatically to special railroad and truck
docks for shipping. To ensure freedom from trans-portation
blocks, raw materials enter plant at
receiving areas on west and north sides and,
after passing through processing and manufac-turing,
the finished products emerge,, packaged
and encased, on the west side, close to receiving.
PAGE 14 THE E. S. C. QUARTERLY WINTER-SPRING, 196C
the impact that the magazine article
had on their fortunes, but, as one tobacco
man explains, "Lorillard's so-called luck
was just the arrival of an opportunity
for which it was prepared."
To supply the soaring demand, the
company installed new machinery at its
Greensboro, N. C, and Louisville plants
and kept them going around the clock.
And, though Kents had to be allocated
to customers, the cigarette manufacturer
never let up on its promotional efforts.
On the contrary, it expanded them.
Kent sales tripled from 1957 to 1958
and the brand had become a leading
seller in several important markets by
early in the latter year. Kent sales
reached 37.5 billion units in 1958, up
from a little over 3 billion in 1956.
Within the past few years, Lorillard
introduced Newport "with a hint of
mint" and added Old Gold Straights to
Old Gold Kings and Old Gold Filter
Kings. In July of this year, it bowed
Spring, a mentholated filter-tip cigarette
with Micropore paper. While the com-pany's
regular cigarette is experiencing
the effects of a declining market for that
type of product, its filter and mentho-lated
brands are doing well in these ex-panding
markets.
Wall Street Report
Last month, a Wall Street firm issued
a report on the P. Lorillard Co. which
stated
:
"Between mid-1957 and late last year,
sales and particularly earnings of this
fourth largest factor in the tobacco
products industry recorded rather spec-tacular
gains. The factor primarily re-sponsible
for the sharp improvement in
operating results, of course, was the vast
upsurge in sales of the company's Kent
"*r.waaoty,Na.4, Chatham (rreet.ncar the Gaol R) Peter and George fWillard
' :S Snuff of the befi quality Is' (la
iuf;taory,No.4, tree'
wb
Cos tobacco,
< 'mm ii kitefoot dr..
Common fmoakingdo
.ViMr. do.
I.adic twift Ho.
m.iy bv- had is follows
Prig or carrot do.
Maecuha muif,
Rapper do.
Slralburghdo.
Common rappee do
P.gta.l do. in fmall rolls, Scented rappee do. of dif-
"-7 1 "- ferine kinds,
HogtaitdO.
\ Scotch Ho.
The above Tnbjcc* and Snuff will be fold reafonable
and warranted :>•, good as any on the conrincnl found If not to prove good, any part of it ma, be returned, if nor
SANDS
ong since been absorbed), American
robacco has held an important position
n the Bonded Clear Havana market. Its
>rands include La Corona, Antonio y
Cleopatra, Bock y Ca., and Henry Clay,
;hese comprising the
argest-selling Bond-ed
Clear Havana
line. A subsidiary
also manufactures
the Cabanas cigar,
which is made in
Havana.
Although smoking
tobacco sales are
relatively minor, the
company's price list
still includes 28
orands. As recently as 1954, there were
32, and in 1931, 126. The line leader is
Half and Half, whose name denotes its
Drigin as a mixture of two older smoking
tobaccos—the Lucky Strike Roll Cut
(Burley tobacco) and the old Bucking-dam
brand (Bright tobacco). And in
the premium-price field Blue Boar, still
blended with a special Virginia smoked
ham flavoring, is American's top entry.
The oldest product still made by the
company—and one of the best-known
tobacco products in history—is the fam-aus
"roll your own" Bright tobacco in
a sack: "Bull" Durham. There are still
men who prefer do-it-
yourself cigarettes
and who will smoke
no other than the
genuine "Bull" in its
historic muslin sack
with the ye 1 1 o w
drawstring.
Today American
Tobacco has four
large cigarette in-stallations
— each
comprising a factory,
one or more leaf stemmeries, and leaf
storage. These centers are located in
Richmond, Durham, Reidsville and Louis-ville.
In addition, the company's plants
include a smoking tobacco factory in
Richmond, and cigar plants in Phila-delphia,
Trenton, Charleston, Owensboro
and Wilkes-Barre, leaf prizeries and
storages in many localities. Its Research
Laboratory, which dates to 1911, is now
housed in a large and recently-expanded
structure in Richmond.
President and chief executive of this
big enterprise is
Paul M. Hahn. A
New Yorker by
birth and graduate
of Columbia Univer-sity
Law School,
Hahn's first con-tact
with American
Tobacco came dur-ing
the 1920s. At
that time he worked
for the corporation's
. e g a 1 counseling YOUNG
firm, and was assigned to American as
resident counsel. In this capacity his
iroad grasp of corporate problems was
recognized by then President G. W. Hill.
In 1931 Hahn was made Assistant to the
President and a Director. Shortly there-after
he became a Vice President. Dur-ing
his three decades as an executive
of American, Hahn has performed in
many capacities: as an administrator, a
"policy man," a public relations and
stockholder relations expert, and during
the 1940s as head of the subsidiary pro-moting
Pall Mall cigarettes. In 1953,
Hahn was a moving force behind the
establishment of Tobacco Industry Re-search
Committee, the industiy's effort
to sponsor impartial, independent scien-tific
research in the field of smoking and
health. In other ways, too, Hahn has
demonstrated his statesmanlike approach
to industry problems (he is the dean of
cigarette company presidents, having
headed American since 1950). The Amer-can
Tobacco Company's advertising
policy is his personal responsibility, and
through thick and thin he has kept his
advertising "in good taste, to match the
good taste of our products." He is mind-ful
of the historic role of the tobacco
tradition in the U. S., and has refused
to capitalize on antitobacco attacks as a
means to quick and easy sales. Appro-priately
for the President of American
Tobacco, Hahn himself smokes cigaret-tes,
a pipe and cigars.
Over the 70-year span of its corporate
existence, American Tobacco has had
Storage sheds of American Tobacco Company in Reidsville.
Durham plant of the American Tobacco Company.
^
PAGE 18 THEE. S.C. QUARTERLY WINTER-SPRING, 1960
Tarevfon S
OUAUUIfcH
/"s/tttxr
Brands of cigarettes manufactured by American Tobacco Company.
only five presidents. The founder was,
of course, J. B. "Buck" Duke. He was
succeeded in 1912 by Percival S. Hill
(who had begun as a drummer for Bull
Durham) and P. S. Hill was followed in
1925 by his son, George Washington Hill,
considered by many to be an advertising
woody midrib from the leaf. It embraces
the tobacco's long sleep in the quiet
storage sheds—two years or more. Then
the strip leaf, exactly blended by class,
grade and crop year, is delivered by the
American Suppliers Division to the fac-tories.
There the final blending of Bright,
Burley, Turkish and Maryland types
takes place under rigidly controlled tem-perature
and humidity. A gentle spray
adds a moisture-retaining agent to help
the blend keep its freshness. Before be-ing
shredded into the long, fine strands
that make it a cigarette mixture, the
strip leaf is flavored, tumbled together
and "bulked"—allowed to stand overnight
while the various oils and aroma mingle
and blend. And the manufacturing flow
chart provides for many tumblings and
retumbilngs so that the mix will be com-pletely
uniform from one cigarette to
the next.
Looking at a quality cigarette, it is
difficult to realize the many steps need-ed
to produce it. Between leaf buying
and final packaging, for instance, the
tobacco is blended no fewer than thirty-five
separate times—at the hundred-plus
company prizeries where leaf is received,
in the seven stemmeries, in the four fac-tories'
spreaders, cutters, dryers, flavor-ing
drums, and making machines.
In the stemmery alone the leaf is
Firing tobacco barn. While this is a wood burn-ing
barn, fuel oil and gas are used extensively
and some barns burn coal.
virtuoso without peer. Vincent Riggio
headed the company after Hill's death in
1946 and was in turn succeeded, in 1950,
by the present incumbent, Paul M. Hahn.
When George W. Hill ended the com-pany's
"one big brand" era in 1939 by
pitting Pall Mall against the field, in-cluding
his own Lucky Strike, he placed
the new king-size brand in a subsidiary
company with its own advertising staff
separate from that
of Lucky Strike.
Paul Hahn became
head of that subsi-diary,
and the custo-dian
of Pall Mall's
fortunes, in 1940.
And ever since that
year — except for a
wartime hiatus when
1j -**. mM advertising was sus- pended Pall Mall
FOURNIER has been forging its
way toward the No. 1 position among all
cigarettes.
On the manufacturing side, the com-pany's
principal activity—the complicat-ed,
painstaking process of making quality
cigarettes—begins with sharp-eyed buy-ers
on the auction markets. It continues
through stemming, or removal of the
Examining tobacco inside the curing barn.
Preparation for stemming tobacco. Wooden hogs-heads
have been removed from this tobacco.
J
An average tobacco farmer and his family tie the leaves on sticks preparatory for curing in
/INTER-SPRING, 1960 THE E. S. C. QUARTERLY PAGE 19
eam-cleaned seven times and is air-ashed
almost continuously, so that the
rip leaf delivered to the factories is as
ean and pure as man can make it. To
3 this, American Tobacco engineers
ave designed and built their own strip-ing
machinery.
Keeping the blend uniform is no simple
isk: so that the tobacco "lines" will be
le same at each of the four cigarette
inters, hogsheads of various grades, of
ifferent geographical classes, and from
;veral crop years must frequently be
vuttled from one location to another.
The factory itself is a giant air-con-itioned
humidor where temperature
tust be just right at every stage. Hu-ddity
is controlled so that moisture con-
>nt in the leaf is maintained within a
derance of one-tenth of one percent.
And when the blend finally reaches the
taking machines, the length and dia-leter
and weight of each cigarette are
"Twenty to the pack" machine in action.
mtrolled just as precisely by a battery
f detectors, feeders and regulators.
Looking at the final product, the re-alts
of all this are not, for the most
art, visible to the naked eye. But among
le nation's 58,000,000 cigarette smokers
here are many mil-ons
who can per-eive
them by taste,
'hese are the people
dio keep The Amer-an
Tobacco Com-any
in business.
Owned by some
5,000 stockholders
the average com-lon
stockholding is
i shares) , Ameri-in
Tobacco employs TURNER
7,000 persons in this country. Like
)bacco-making itself, employment with
ie company is something of a tradition
:
vo out of every three regular employees
[ the cigarette installations have been
rtK The American Tobacco Company
in years or more; 20% have service
icords of over twenty-five years. Most
nployees are in the four big cigarette
inters; a significant number are in the
af-buying division, American Suppliers,
hich purchases a quarter-billion dol-rs'
worth of tobacco in an average
?ar for use in the company's brands,
his leaf, most of which is aged two
kars or more before it enters the manu-cturing
stream, is stored in some 271
huge storage sheds in and around the
factory centers.
There is a special overseas subsidiary,
American Tobacco Company of the
Orient, Inc., which purchases Turkish-type,
aromatic tobacco in Turkey and
Greece.
Another subsidiary, J. Wix & Sons
Limited, manufac-tures
cigarettes in
London for the
United Kingdom
market. Another, the
Cuban Tobacco Com-pany
Inc., purchases
Havanan leaf for
use in cigars and
also has manufac-turing
plants of its
own.
One measure of
the size of the American Tobacco organ-ization
is its dollar sales, reported as
$1,103,023,397 in 1958 and even more
in 1959. Another is the fact that in each
of the last ten years, the company has
paid out more than one-half billion dol-lars
to the Federal and state govern-ments
for excise and income taxes. Dur-ing
the decade just ended—the 1950s
—
earnings increased by about 50%. This
progress is reflected not only in dividends
to stockholders but also in provisions for
WILLIAMS
Workers check weight cigarettes quality
testing.
the welfare of employees. Pending for
action at the annual meeting of April,
1960 is a new profit-sharing plan cover-ing
all regular full-time employees in
this country. This will be in addition to
retirement pay bene-fits
which have been
in effect for a num-ber
of years.
Headquarters of
The American To-bacco
Company are
in New York City,
in a gleaming stain-less-
steel skyscraper
across from Grand
Central Station.
Many of the corpo-ration's
directors make their offices there,
including those familiar to North Caro-linians.
John A. Crowe, Senior Vice
President, Manufacture and Leaf, is a
frequent visitor to the Durham and
Reidsville plants. Vice President Virgil
D. Hager, for many years manager of
the Durham factory, also makes his
SPARROW
office in New York, as does William B.
Young, originally of Reidsville and now
Assistant to the Senior Vice President.
Managing the Durham and Reidsville
factories are, respectively, Henry V. H.
Stoever, Jr., and Felix E. Fournier. Leaf
Division (American Suppliers) chiefs in
those towns are J. W. Williams and
Royal W. Sands. President of the Amer-ican
Suppliers Division, with his head-quarters
in Richmond, is George Turner,
a Director of the company. Also a
Director, and Vice President of Ameri-can
Suppliers Division is John B. Spar-row,
who operates
from a Durham
office. Guiding policy
for these executives
and for those who
work under them is
the traditional
phrase, "Quality of
product is essential
to continuing success." The company's
Indian symbol "Powhattan" is well-known;
not so well known is the fact
that it depicts the famous seventeenth-century
chief Powhattan, father of Poca-hontas
and known to legend as "The
Guardian of the Leaf."
POWHATTAN
Mr. Henry V. H. Stoever, Jr., manager of the
Durham branch of American Tobacco Company
is shown with packing machine operator.
PR-AMA
—Continued from page 11
—
589, Raleigh, N. C. There will be a
limited number of rooms at the YMCA
available for Wednesday and/or Thurs-day
nights. Room reservations must be
made directly with the Secretary,
YMCA, Raleigh.
The two Societies have, in the past
year, brought many top-flight PR prac-titioners
into the area to speak to the
public and their own members. These
organizations have probably done more
to establish the PR Profession in the
Carolinas as a reliable group of public
servants than any other effort in recent
years. Among prominent speakers
brought to the area are: Dr. Paul
Ylvisaker of the Ford Foundation; Fred
Johnson, formerly Chairman of PR,
Rexall Drug and Chemical Co., Cali-fornia;
Mel Emdee, VP of Creative Arts,
Washington, one of the top authorities
in film production; Henry E. Gellermann,
Director of PR and Advertising for the
Wall Street firm of Bache & Company;
and Paul V. Zucker, vice president of
the New York firm of Ruder and Finn.
PAGE 20 THEE. S.C. QUARTERLY WINTER-SPRING, 1960
TOBACCO'S LAND OF PLENTY
By James P. Richards
President, The Tobacco Institute, Inc.
When it was suggested that I prepare
an article for this special tobacco issue
of The E.S.C. Quarterly, I was interest-ed
and pleased.
Quite apart from my association with
the Tobacco Institute, I have always had
a keen interest in the development of the
industry in my neighboring state. The
paramount place North Carolina has long-held
in tobacco agriculture and tobacco
manufacturing is something to admire.
We grow flue-cured tobacco in my
home state of South Carolina and a good
deal of it, too. I know something about
tobacco farming and its economic im-portance
to the state. We don't manufac-ture
cigarettes—that is left to the ex-perienced
and well-established factories
in North Carolina, Virginia and Ken-tucky.
But we do manufacture several
hundred million good cigars each year.
We at the Tobacco Institute have been
particularly interested not only in the
economic but also the historical and cul-tural
role tobacco has in America. I
knew North Carolina was represented in
a good deal of historical material. So as
a basis for this article, I asked for some
of the pertinent facts. I was hardly pre-pared
for the wealth of historical and
economic information that was turned
up about the Old North State.
Only a small part of that information
can be recounted here. The full story of
tobacco in North Carolina could well fill
several volumes, and I am sure that this
issue of the Quarterly will contain the
most relevant material.
EDITOR'S NOTE
James P. Richards of Lancaster, South
Carolina, was serving as Chairman of the
House Committee on Foreign Affairs when
he retired from Congress, without seeking
re-election, at the end of the 84th Con-gress,
January 2, 1957. He had represented
the Fifth Congressional District of South
Carolina continuously since being first
elected in 1932.
On January 7, 1957, he was appointed
by President Eisenhower as special assist-ant
to the President with personal rank
of Ambassador. In this capacity his duties
were to advise and assist the President
and Secretary of State on plans to im-plement
the Eisenhower doctrine. After
carrying out a special mission last spring
to the Middle East, he undertook another
assignment in the Pacific area which he
has recently completed.
Mr. Richards served as a delegate to the
Japanese Peace Treaty Conference in 1951.
He was chairman of a Joint Congressional
Study Mission sent to Europe in 1951 at
the request of General Eisenhower. He was
United States delegate to United Nations
8th General Assembly in 1953.
A native of South Carolina, Mr.
Richards was born in 1894 and graduated
from the University of South Carolina,
which in 1955 conferred upon him an
honorary LL.D. degree.
Mr. Richards is a veteran of World
War I, is married and has two sons and
one daughter.
Despite its importance in the tobacco
economy today, North Carolina is a rela-tive
newcomer.
A year after the War Between the
States ended, production of tobacco in
North Carolina totaled only 7,840,000
pounds. In 1959, the state's tobacco har-vest
was very nearly a hundred times
that of 1866, or over 776,000,000 pounds.
Not a single cigarette had been com-mercially
manufactured in North Caro-lina
by 1866. But in 1959 its "making"
factories had turned out well over half
of the 488 billion cigarettes produced in
the United States.
Between these dates lies a near- cen-tury
record of agricultural and manu-facturing
development of tobacco in
North Carolina.
The Long Road to Success
Virginia and Maryland, it will be re-membered,
began their economic careers
as tobacco-producing colonies. That was
not so of the Province of Carolina. The
now long-established status of North
Carolina as the world's major producer
of cigarette leaf and of cigarettes was,
chronologically, a late achievement. It
was almost 275 years after Spanish
colonial seeds were, around 1612, first
planted in Jamestown before the Tar
Heel State began to assume importance
in the tobacco economy.
Once that development began, the
quality of North Carolina leaf and the
energy of local manufacturers rapidly
carried the state to first place in the to-bacco
industry.
During that progressive development,
while superior leaf and superior tobacco
goods were being produced, the brand
names of smoking tobaccos and cigarettes
manufactured in North Carolina became
known around the globe. Outstanding
men in the state created a great indus-try
and many became world-famous. In
the process they also increased the wealth
of the community and made valuable
contributions to its culture.
The Seedling Years
Looking back briefly, it is interesting
to note the conditions under which North
Carolina began. When the establishing of
a colony adjoining southern Virginia was
being discussed, in 1662, the noblemen
requesting a land grant stated that set-tlers
would not grow tobacco in the
new province in competition with plant-ers
in Virginia and Maryland. These two
colonies were then going through a re-current
depression owing to overproduc-tion
of their staple.
But settlers from Virginia and Scots-men,
Germans and others from southern
Pennsylvania had been moving into the
Carolina area from 1660 on. They were
soon producing an excellent type of to-bacco.
A few years later Virginia penal-ized
its unwanted stepchild by prohibit-i
RICHARDS
ing entry of North Carolina tobacco int(|
its dominion.
English Rules and Economic Laws
The England traders, who had mor(|
influence in directing the new province
than the Lords Proprietors of Carolina
thereupon shipped Carolina tobacco di
rectly to Scotland and the Continent. Ii
these operations they were violating th<
Navigation Acts which required colonia
tobacco to be landed first in Englisl
ports. And Dutch merchantmen, alway:
eager at that period to annoy the Eng
lish, frequently slipped into that "refugi
of pirates," Rogue's Harbor (AlbemarL
Sound), and took out shiploads of goo<
leaf.
Under the influence of the shrew<
northern traders Carolina's tobacco pro
duction could well have increased. Ther'
was, however, an economic situatioi
which intervened: too much leaf fron|
Maryland and Virginia in English an